US shares climbed, propelling the Standard & Poor’s 500 Index to within three points of an all-time peak, as investors speculated that the Federal Reserve will keep interest rates low as the economy rebounds.
The S&P 500 increased 0.2% to 1,985.41 as of 1:36 pm in New York, on course to close at a record of 1,987.98. The Dow Jones Industrial Average advanced 47.17 points or 0.3%, to 16,966.76. The volume of shares traded in S&P 500 firms was 27% higher than the average for the past 30 days for this time of the day.
“I think the consensus hope is that a dovish tone will prevail and I think that’s causing the market to at least stabilize and see a little bit of a bump up here.We had strong macroeconomic fundamentals, good data around housing, and a dovish policy wouldn’t hurt,” Sean Lynch of Wells Fargo Private Bank in Omaha, Nebraska told Bloomberg.
The S&P 500 needs to add only 0.1% to reach an all-time high hit July 24 against the background of speculations that the fed will retain interest rates near zero for longer despite signs economic growth is accelerating.
Investors will analyze the minutes from the July 29-30 Fed meet today in Washington, to have an idea of whether improving economic figures have made policy makers willing to bring closer the timing of any rate hike.
The fed is on schedule to conclude its monthly stimulus program in October, while chair of the Fed Janet Yellen has said policy makers will retain interest rate low for an appreciable time after that.
According to USA Today Money, Wall Street looked to approach a correction in mid-July when a Malaysian airliner was downed over Ukraine, triggering a spike of geopolitical anxiety and prompting investors to abandon stocks in risk-cutting moves.
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