US Market Indexes Gain on Wednesday

Marcus Newton
February 4, 2018

The benchmark USA indices recovered from the selloff seen in the last two sessions to end marginally higher on Wednesday, with the Dow Jones Industrial Average and the S&P 500 indices posting the highest monthly gains since March 2016.

All this sets the stage for the Federal Reserve to continue raising interest rates, with the next hike expected in March.

ANALYST'S TAKE: "Fed Chair Janet Yellen's last meeting prior to stepping down saw the Fed reinforcing their positive outlook over both the economy and inflation while unanimously voting to keep rates unchanged", Jingyi Pan, a market strategist at IG in Singapore, said in a daily commentary.

The Standard & Poor's 500 index rose 1.38 points, or 0.1 percent, to 2,823.81.

The Russell 2000 index of smaller-company stocks gave up 7.83 points, or 0.5 percent, to 1,574.98. Technology companies and banks accounted for much of the market's gain, outweighing losses in materials and other sectors.

All 30 components of the Dow Jones Industrial Average were lower on Friday and 10 of the 11 major S&P sectors fell, led by the energy index's 1.83 per cent decline.

Investors continued to sift a raft of corporate earnings reports Thursday.

However, nonfarm productivity fell 0.1 percent in the fourth quarter, which was the first drop since the first quarter of 2016, while unit labor costs rose 2.0 percent in the final three months of 2017.

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The Nasdaq composite lost 25.62 points, or 0.3 per cent, to 7,385.86. The stock added $6.20 to $193.09.

FUDGED IT: Hershey shares fell 5.4 percent after the company's latest quarterly results fell short of Wall Street's expectations. The S&P 500 and Nasdaq couldn't make it back into the green before the close, but shaved most of today's losses to close only modestly lower. The stock, which has been the biggest gainer in the Dow over the past year, added $19.75 to $357.46.

In company news, Boeing shares added 4.9%, contributing roughly 110 points to the Dow Industrials, after the aerospace giant forecast a higher profit margin and a big rise in cash generated from record jetliner deliveries. Brent crude, used to price global oils, declined 16 cents to $68.36 in London.

Benchmark 10-year Treasury yields extended their rise after the payrolls data and jumped to more than 2.818 per cent, its highest level since early 2014.

The rise in bond yields "is certainly beginning to concern the markets".

The Nasdaq is down 94.29 points, or 1.3 percent. Japan's Nikkei ended down 0.8% as the yen strengthened against the dollar.

The Dow is down 430 points, or 1.6 per cent. Hong Kong's Hang Seng index fell 0.8 percent.

Other reports by MaliBehiribAe

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