NEW YORK — A government report on retail sales in May was better than expected Tuesday, and that drove stocks higher for only the third time this month.
The Dow Jones industrial average jumped back above 12,000, and all three indexes had their best day so far in June.
The government said retail sales edged down 0.2 percent last month, but economists had expected worse. And excluding weak car sales, retail sales rose 0.3 percent. Americans bought fewer cars during the month, but that was more a reflection of temporary supply chain disruptions caused by the earthquake and tsunami disaster in Japan.
“The good news is the consumer is hanging in there,” said Rob Lutts, president and chief investment officer of Cabot Money Management.
The stronger report on retail sales sent the stocks of department stores and other retailers higher. Nordstrom and Home Depot rose 4 percent. J.C. Penney jumped 17 percent after the department store chain named Ron Johnson, the man who pioneered Apple’s retail stores, as its next chief executive. Penney’s stock rose the most of any company in the S&P 500.
The Dow rose 123.14 points, or 1 percent, to close at 12,076.11. The S&P rose 16.04, or 1.3 percent, to 1,287.87. The Nasdaq composite rose 39.03, or 1.5 percent, to 2,678.72.
Five stocks rose for every one that fell on the New York Stock Exchange.
The government also reported that wholesale prices rose in May by the smallest amount in 10 months. That helped allay concerns by investors that rising costs would slow recovery.
Stocks have tanked over the past two weeks on concerns that the economy is losing strength. The manufacturing industry is slowing, home sales are weak and the job market remains sluggish. Investors also are nervous because the Federal Reserve’s $600 billion bond-buying program is winding down at the end of June.
