Wall Street climbs on expectations for modest Fed taper: NEW YORK, Sept 18 — US stocks advanced yesterday on expectations the Federal Reserve will make only moderate changes to its stimulus that has been highly supportive of stocks and other assets at the conclusion of its two-day meeting. The policy-setting Federal Open Market Committee began meeting yesterday to discuss whether to trim its bond purchases, or quantitative easing. Many investors expect Fed chairman Ben Bernanke will announce a scale-back of purchases by US$10 billion (RM32.5 billion) a month to US$75 billion, while keeping rates close to zero. “The (US$10 billion) appears to be what investors are looking for, as long as the taper is not bigger than people were expecting the market will react positively,” said Paul Mangus, head of equity research and strategy at Wells Fargo Private Bank in Charlotte, North Carolina. “The Fed is very aware of how they believe investors will react. They’ve been very skillful about trying to manage expectations.” A statement with the FOMC’s decision will be released this afternoon, followed by a Bernanke news conference. The Dow Jones industrial average rose 34.95 points or 0.23 per cent, to 15,529.73, the S&P 500 gained 7.16 points or 0.42 per cent, to 1,704.76 and the Nasdaq Composite added 27.853 points or 0.75 per cent, to 3,745.699. The S&P 500 closed above the key resistance level of 1,700 for the first to since August 5 and is 0.3 per cent below its record high of 1,709.67. US consumer prices barely rose in August, but gains in rents and medical costs pointed to a stabilisation in underlying inflation that could allow the Fed to scale back stimulus. Adding to investor confidence, crude prices continued to fall as a deal averting a US-led attack on Syria calmed fears of a Middle East oil supply disruption. Brent settled down 1.7 per cent to US$108.19 and is down 2.5 per cent in the past two days. US crude settled down 1.1 per cent on the day at US$105.42 a barrel. Easing oil prices helped boost airline stocks, along with a JP Morgan upgrade of Delta Air Lines Inc and US Airways Group Inc, to “overweight” ratings. Delta shares rose 0.7 to US$23.32 while US Airways climbed 3.6 per cent to US$18.72. The NYSEArca airline index gained 1.2 per cent. Apple shares, which Monday closed below their 200-day moving average for the first time since August 12, rose 1.2 per cent to US$455.32. The stock had fallen more than 11 per cent in the prior five sessions after investors were disappointed by the new products and prices introduced last week. Pandora Media Inc shares reversed course after early declines and closed up 5 per cent at US$25.19, a day after the company warned that its business growth is slowing and proposed a follow-on offering of 10 million shares. Microsoft shares edged up 0.4 per cent to US$32.93 after the company said it would raise its quarterly dividend by 22 per cent. Shares of Aeropostale Inc surged 18.1 per cent to US$10.17 after Sycamore Partners reported a 7.96 per cent holding in the teen apparel retailer. The S&P retail index gained 0.9 per cent. Safeway shares jumped 10.5 per cent to US$30.99 after the company adopted a stockholder rights plan. Activist investor Jana Partners disclosed a 6.2 per cent stake in the grocery chain and said it has held discussions with management about reviewing strategic alternatives. Volume was light with about 5.06 billion shares traded on the New York Stock Exchange, NYSE MKT and Nasdaq, below the daily average of 6.23 billion. Advancing stocks outnumbered declining ones on the NYSE by 2,006 to 981, while on the Nasdaq, advancers beat decliners 1,708 to 799. — Reuters dlvr.it/3zjvmY
Posted on: Tue, 17 Sep 2013 23:29:12 +0000
Trending Topics
Recently Viewed Topics
© 2015