US dollar index rose by 0.4%
The US dollar index, which measures the strength of the US dollar against the other major currencies, was trading on a negative trajectory throughout the week ending February 12, 2016. However, the US dollar index managed to reverse some of those losses on Friday, February 12, after strong retail sales data and weak European data helped put together a bounce in the dollar, and the US dollar index rose by 0.40% for the day. The US dollar index went to a high of 96.22 before ending the day at 95.94.
Decent retail sales data release
The US Census Bureau published the retail sales data for the month of January on February 12, 2016. Month-over-month retails sales rose by 0.2%, while core retail sales posted a rise of 0.1%. This increase was majorly attributed to increased spending in general merchandise, which accounts for a major chunk of retail sales.
Automobile sales also saw a rise of 0.6% in January. But December retail sales, which had been negative, were revised to a rise of 0.2%, which means that retails sales have actually been rising for the third straight month. Among other data releases, the University of Michigan published its preliminary consumer sentiment report, which came out below expectations at 90.7.
Impact on the market
Among ETFs, the PowerShares DB US Dollar Index Bullish ETF (UUP) rose by 0.44% on February 12, 2016. The WisdomTree Bloomberg US Dollar Bullish ETF (USDU) encompasses developed economies and emerging market currencies, and it followed a similar trajectory rising by 0.37% that day. By comparison, the United States Oil Fund (USO) rose by a significant 4.2%.
Individual US stocks also started on positive trajectories on February 12, 2016. Lennar (LEN) and Toll Brothers (TOL), for example, were trading with a strong positive bias after the retail sales data release, rising by 5.0% and 3.9%, respectively, on the day. Crude oil-related stock Exxon Mobil (XOM) rose by 1.8%, and banking stocks followed a similar pattern, with Bank of America (BAC) jumping by a significant 7.1%.