Stocks are higher in early trading Wednesday as investors react to a surprisingly big increase in U.S. retail sales last month and quarterly results from Lowe's and J.C. Penney.
Investors were also waiting for minutes from the Federal Reserve's October policy meeting, which will be out later in the afternoon.
The Dow Jones industrial average rose 26 points, or 0.2 percent, to 15,992 in the first hour of trading. The broader Standard & Poor's 500 index was up five points, or 0.3 percent, to 1,793 and the Nasdaq composite rose 13 points, or 0.3 percent, to 3,944.
J.C. Penney led the S&P 500 index higher with an 8 percent gain. Despite reporting a loss in the third quarter, there were hopeful signs for the long-struggling store chain heading into the holiday shopping season. The company said its sales rose in October for the first time since December 2011. The stock rose 70 cents to $9.42. It's still down 52 percent this year.
Meanwhile, shares of the home improvement chain Lowe's fell $1.74, or 4 percent, to $48.68. The Home Depot competitor said its third-quarter profits rose 26 percent, but its results came in slightly short of analysts' expectations. Lowe's said it earned 47 cents per share, a cent short of the 48 cents analysts were looking for.
The holiday shopping season is a make-or-break time for U.S. retailers, and more broadly the U.S. economy. Sales during November and December can account for up to 40 percent of the annual revenue for store operators.
So far, there's reason to be hopeful. The National Retail Federation, the nation's largest retail trade group, expects holiday sales to increase 3.9 percent to $602.1 billion this year.
Separately, the U.S. Commerce Department said Wednesday that U.S. retail sales rose 0.4 percent in October. That was much better than the 0.1 percent increase economists had predicted, according to FactSet, a financial information provider.
The Federal Reserve will release minutes from its October policy meeting at 2 p.m. Eastern. Investors will be looking for any clues on when the Fed might start to pull back on its economic stimulus program.
The central bank has been buying $85 billion in bonds a month in an effort to keep interest rates low and stimulate the economy encouraging borrowing and hiring. At its October meeting the Fed voted to keep the bond-buying program intact, saying that the economy had not improved enough.
The Fed's next policy meeting is scheduled for Dec. 17-18. Investors are split on whether the bank will vote to pull back its bond purchases, or "taper" them, as it is sometimes called on Wall Street, so soon after voting to keep things as they are.
Fed Chariman Ben Bernanke "has left the door open for a December taper but is not giving a sense that the Fed is in any rush," analysts with RBS wrote in a note to investors Wednesday.
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