S&P 500, Nasdaq edge higher as ECB puts off rate hike
The S&P 500 and Nasdaq rose on Thursday after the European Central Bank said it would not raise interest rates until mid-2019, a day after the U.S. Federal Reserve increased its key rate and hinted at two more hikes by the end of 2018.
The ECB decided to end its bond-purchase programme at the close of the year and said rates would stay unchanged until the summer of 2019.
The Fed`s upbeat assessment of the economy was followed by Thursday`s better-than-expected retail sales data while jobless claims showed unemployment rolls falling to a near 44-1/2 year low point, echoing the central bank`s optimism.
The gains come on the heels of Wednesday`s late session volatility as the number of expected Fed rate hikes this year rose from three to four, prompting a broad sell-off.
"Everyone`s been worried about rising rates, but rising rates are indicative of economic growth and that`s good news," said Doug Cote, chief market strategist at Voya Investment Management in New York.
"I think the market is incorrect in believing that we`re somehow in a secular stagnation story, when really we`re in a stealth economic boom. And that will continue to drive markets higher," Cote said.
The Dow Jones Industrial Average <.dji> fell 42.73 points, or 0.17 percent, to 25,158.47, the S&P 500 <.spx> gained 5.42 points, or 0.20 percent, to 2,781.05 and the Nasdaq Composite <.ixic> added 57.69 points, or 0.75 percent, to 7,753.39.
Of the 11 major sectors of the S&P 500, seven were in positive territory.
The rate-sensitive financial sector <.spsy> was the biggest percentage loser of the S&P 500, led by a 1.7 percent decline in JP Morgan Chase
Among sectors, the biggest percentage gainers were telecom <.splrcl> and utilities <.splrcu> and consumer discretionaries <.splrcd>.
Twenty-First Century Fox
Disney shares advanced 2.2 percent, providing the biggest boost to the Dow.
Shares of Royal Caribbean Cruises
Advancing issues outnumbered declining ones on the NYSE by a 1.26-to-1 ratio; on Nasdaq, a 1.09-to-1 ratio favored advancers.
The S&P 500 posted 33 new 52-week highs and 1 new lows; the Nasdaq Composite recorded 144 new highs and 23 new lows.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
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