AGL 40.18 Increased By ▲ 0.18 (0.45%)
AIRLINK 127.31 Increased By ▲ 0.27 (0.21%)
BOP 6.64 Decreased By ▼ -0.03 (-0.45%)
CNERGY 4.50 Decreased By ▼ -0.01 (-0.22%)
DCL 8.56 Increased By ▲ 0.01 (0.12%)
DFML 41.97 Increased By ▲ 0.53 (1.28%)
DGKC 87.90 Increased By ▲ 1.05 (1.21%)
FCCL 32.71 Increased By ▲ 0.43 (1.33%)
FFBL 65.21 Increased By ▲ 0.41 (0.63%)
FFL 10.33 Increased By ▲ 0.08 (0.78%)
HUBC 109.49 Decreased By ▼ -0.08 (-0.07%)
HUMNL 14.65 Decreased By ▼ -0.03 (-0.2%)
KEL 5.13 Increased By ▲ 0.08 (1.58%)
KOSM 7.51 Increased By ▲ 0.05 (0.67%)
MLCF 41.90 Increased By ▲ 0.52 (1.26%)
NBP 59.90 Decreased By ▼ -0.51 (-0.84%)
OGDC 194.25 Increased By ▲ 4.15 (2.18%)
PAEL 28.29 Increased By ▲ 0.46 (1.65%)
PIBTL 7.81 Decreased By ▼ -0.02 (-0.26%)
PPL 152.00 Increased By ▲ 1.94 (1.29%)
PRL 26.70 Decreased By ▼ -0.18 (-0.67%)
PTC 16.15 Increased By ▲ 0.08 (0.5%)
SEARL 85.75 Decreased By ▼ -0.25 (-0.29%)
TELE 7.64 Decreased By ▼ -0.07 (-0.91%)
TOMCL 35.43 Increased By ▲ 0.02 (0.06%)
TPLP 8.10 Decreased By ▼ -0.02 (-0.25%)
TREET 16.10 Decreased By ▼ -0.31 (-1.89%)
TRG 52.80 Decreased By ▼ -0.49 (-0.92%)
UNITY 26.40 Increased By ▲ 0.24 (0.92%)
WTL 1.26 No Change ▼ 0.00 (0%)
BR100 9,958 Increased By 74.7 (0.76%)
BR30 30,930 Increased By 329.5 (1.08%)
KSE100 93,876 Increased By 520.2 (0.56%)
KSE30 29,094 Increased By 162.6 (0.56%)
Markets Print 2019-11-01

S&P closes at record on Fed bump

US stocks advanced on Wednesday, with the S&P 500 closing at a record for the second time in three sessions, after a policy statement by the US Federal Reserve that cut interest rates by a quarter of a percentage point. The Fed lowered its policy rate to
Published 01 Nov, 2019 12:00am

US stocks advanced on Wednesday, with the S&P 500 closing at a record for the second time in three sessions, after a policy statement by the US Federal Reserve that cut interest rates by a quarter of a percentage point. The Fed lowered its policy rate to a target range between 1.50% and 1.75%, but dropped a previous reference in its statement to "act as appropriate" to sustain the economic expansion, which could signal the Fed may hold off on future rate cuts.

Chair Powell said "we believe that monetary policy is in a good place," in a press conference following the announcement, indicating the central bank was likely to keep rates on hold absent a major change in the economic outlook, helping stocks move higher in the latter stages of trading. "The only concern in this market was that they'd make some statement saying this is it," said Rick Meckler, partner at Cherry Lane Investments, New Vernon, New Jersey. "They said they remain open to what the data shows them. Flexibility is what the market wants to see."

Hopes of a rate cut and recent optimism around the trade talks had helped lift the benchmark S&P 500 to record intraday highs for three straight sessions. The Dow Jones Industrial Average rose 115.54 points, or 0.43%, to 27,186.96, the S&P 500 gained 9.92 points, or 0.33%, to 3,046.81 and the Nasdaq Composite added 27.12 points, or 0.33%, to 8,303.98.

The interest-rate sensitive banking sub-sector pared losses after the statement, but was still down 0.69%. Utilities, up 0.86%, was the best performing while the energy sector lagged, down 2.12%. Investors also dealt with the latest round of corporate earnings. Shares of General Electric Co jumped 11.47% after the industrial conglomerate beat quarterly profit estimates and raised its cash forecast for the year.

Yum Brands Inc shed 6.22% and was among the top decliners on the benchmark index as the KFC owner missed quarterly profit expectations. US economic growth slowed less than expected in the third quarter, a Commerce Department report showed, as declining business investment was offset by resilient consumer spending and a rebound in exports, further allaying financial market fears of a recession.

Other data showed a modest acceleration in private sector job growth, boosted by gains in the service sector, according to the ADP National Employment Report. The data comes ahead of Friday's payrolls report. About 74.1% of the 278 S&P 500 companies that have reported so far have beaten profit estimates, according to Refinitiv data.

However, profit growth forecasts for the next four quarters have been revised lower, even as expectations for the decline in third quarter earnings has shrunk to 1.6%, compared with a 2.2% fall at the start of the month. Buoying the Dow was a 2.88% rise in shares of Johnson & Johnson. The company said 15 new tests found no asbestos in a bottle of baby powder that the US Food and Drug Administration says tested positive for trace amounts of asbestos. The FDA said it stands by its finding.

Mattel Inc surged nearly 13.78% after the US toymaker reported a surprise jump in quarterly revenue. Advancing issues outnumbered declining ones on the NYSE by a 1.15-to-1 ratio; on Nasdaq, a 1.01-to-1 ratio favored decliners. The S&P 500 posted 21 new 52-week highs and 4 new lows; the Nasdaq Composite recorded 67 new highs and 72 new lows.

Copyright Reuters, 2019

Comments

Comments are closed.