Markets fall as decline in US retail sales raises question on growth

Markets fell on Thursday.

The S&P 500 and the STOXX Europe 600 both fell 0.3 percent. The Nikkei 225 was flat.

Investor sentiment was dampened by a report on Thursday showing that US retail sales fell 1.2 percent in December, the largest decline since September 2009.

“The decline in retail sales calls into question the domestic growth assumption,” said Andrew Hollenhorst, an economist at Citigroup.

Another report showed that initial claims for state unemployment benefits in the US increased 4,000 in the week ended 9 February.

Adding to signs of a cooling economy was another report on Thursday showing that producer prices rose 2.0 percent in the 12 months through January, the smallest gain since July 2017.

A report on Wednesday had shown that consumer prices were unchanged in January for a third straight month.

“This further corroborates our view that a well-behaved inflationary environment gives the Fed room to remain patient, hiking only once in 2019 and only after a pause in the first half,” said Jake McRobie, a US economist at Oxford Economics.