Thursday’s early trade: Fed’s inflation push lifts S&P, Nasdaq to new highs

NEW YORK: The S&P 500 and the Nasdaq rose to record highs on Thursday as the Federal Reserve sought to achieve inflation averaging 2% over time in an attempt to lift the US economy out of a deep pandemic-driven recession.

Setting out the central bank’s aggressive new strategy at a virtual Jackson Hole symposium, Fed chief Jerome Powell said it would offset below-2% periods with higher inflation “for some time,” and ensure employment doesn’t fall short of its maximum level.

Eight of the 11 major S&P sectors were trading higher, with economically-sensitive financials leading gains. The communication services index, which houses Google-parent Alphabet Inc and Facebook Inc, fell for the first time in four days.

At 10:52 a.m. ET, the Dow Jones Industrial Average was up 255.59 points, or 0.90%, at 28,587.51, on course to turn positive on the year for the first time since the coronavirus-driven crash in March.

The S&P 500 was up 15.09 points, or 0.43%, at 3,493.82, and the Nasdaq Composite was up 10.94 points, or 0.09%, at 11,676.00.

Boeing Co rose 3.1% after the European Union Aviation Safety Agency announced plans to begin flight tests of its 737 MAX plane, a move viewed as a key milestone toward its return to service.

Abbott Laboratories surged 6.6% after the medical device maker won US marketing authorization for a $5 rapid Covid-19 portable antigen test.—Reuters