Overseas Mkt Report
The benchmark S&P 500 stock index has clinched its longest bull-market run, closing above its previous January high, as Federal Reserve Chairman Jerome Powell affirmed the US central bank’s current pace of rate hikes. The S&P had last reached a new closing high on January 26, then retreated more than 10 per cent, a correction that lasted until February 8. Friday’s new closing high confirmed that the index’s bull run remained intact.
Speaking at a research symposium in Wyoming, Powell said the Fed’s gradual interest rate hikes were the best way to protect the economic recovery, maintain strong job growth and keep inflation under control. His comments did little to change market expectations of a rate hike in September and perhaps again in December. Investors said they were reassured that Powell’s comments stayed in line with previous commentary from the Fed regarding policy. Economic data also boosted sentiment.
New orders for key US-made capital goods increased more than expected in July and shipments growth held firm, the Commerce Department said. Chief market strategist at Bruderman Asset Management in New York Oliver Pursche said that was what the markets wanted to hear. “The economic data and strong environment as a whole is the basis, and (Powell) didn’t get in the way,” he said.
The Dow Jones Industrial Average rose 133.37 points, or 0.52 per cent, to 25,790.35, the S&P 500 gained 17.71 points, or 0.62 per cent, to 2,874.69 and the Nasdaq Composite added 67.52 points, or 0.86 per cent, to 7,945.98.For the week, the Dow added 0.47 per cent, the S&P gained 0.87 per cent, and the Nasdaq increased 1.66 per cent.
Morning Market Note - Monday 27th August