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Stocks rallied Friday as traders cheered comments from Federal Reserve Chairman Jerome Powell at the annual central bank conference in Jackson Hole, Wyoming, that point to stronger-than-expected economic growth.
The Dow Jones Industrial Average closed up 247.48 points, or 0.7 per cent at 34,346.90, after being up more than 300 points at session highs. The S&P 500 gained about 0.7 per cent to close at 4,405.71, while the tech-heavy Nasdaq Composite advanced 0.9 per cent to 13,590.65, which was enough to help both indexes snap a three-week losing streak. However, the Dow logged a second-straight week of losses.
Optimism was fueled, in part, by Powell’s confidence in continued economic growth in the US, as he cited “especially robust” consumer spending and early signs of a recovery in the housing market. He reiterated the central bank’s commitment to pull inflation back down to its 2 per cent goal.
Powell commented, “the economy may not be cooling as expected. So far this year, GDP (gross domestic product) growth has come in above expectations and above its longer-run trend, and recent readings on consumer spending have been especially robust.”
“In addition, after decelerating sharply over the past 18 months, the housing sector is showing signs of picking back up.”
Turning to China, the nation has halved the stamp duty on stock trading, effective on Monday, in a bid to revitalise the capital market and enhance investor confidence amid a struggling economy; the finance ministry's decision follows reports of a planned reduction after a significant share index drop to nine-month lows.
Overall, the S&P 500 energy and consumer discretionary sectors both rose at least 1 per cent on Friday. Petroleum company Valero Energy and toymaker Hasbro were among the day’s biggest gainers, advancing 2.8 per cent and 5.7 per cent, respectively.
Futures
The SPI futures are pointing to a 0.3 per cent gain.
Currency
One Australian dollar at 7:40 AM was buying 64.12 US cents.
Commodities
Gold lost 0.37 per cent. Silver added 0.03 per cent. Copper lost 0.25 per cent. Oil gained 0.99 per cent.
Figures around the globe
European markets closed higher. London’s FTSE added 0.07 per cent, Frankfurt also added 0.07 per cent, and Paris closed 0.21 per cent higher.
Turning to Asian markets, Tokyo’s Nikkei dropped 2.05 per cent, Hong Kong’s Hang Seng fell 1.40 per cent while China’s Shanghai Composite closed 0.59 per cent lower.
On Friday, the Australian sharemarket closed 0.93 per cent lower at 7,115.
Ex-dividends
Australian United Investment Company (ASX:AUI) is paying 20 cents fully franked
Aurizon Holdings (ASX:AZJ) is paying 8 cents 60 per cent franked
Challenger (ASX:CGF) is paying 12 cents fully franked
Coronado Global Resources Inc (ASX:CRN) is paying 0.5325 cents fully franked
Domino's Pizza Enterprises (ASX:DMP) is paying 42.6 cents unfranked
Diversified United (ASX:DUI) is paying 9 cents fully franked
ECP Emerging Growth (ASX:ECP) is paying 2.9 cents fully franked
Hansen Technologies (ASX:HSN) is paying 5 cents 30 per cent franked
Pinnacle Investment (ASX:PNI) is paying 20.4 cents fully franked
Santos (ASX:STO) is paying 13.5577 cents unfranked
Winton Land (ASX:WTN) is paying 1.9954 cents unfranked
Dividends payable
Waypoint REIT (ASX:WPR)
Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap.
Disclaimer
The views, opinions or recommendations of the commentators in this presentation are solely those of the author and do not in any way reflect the views, opinions, recommendations, of Sequoia Financial Group Limited ABN 90 091 744 884 and its related bodies corporate (“SEQ”). SEQ makes no representation or warranty with respect to the accuracy, completeness or currency of the content. Any prices published are accurate subject to the time of filming and shouldn’t be relied upon to make a financial decision. Commentators may hold positions in stocks mentioned and companies may pay FNN to produce the content at times. The content is for educational purposes only and does not constitute financial advice. Independent advice should be obtained from an Australian Financial Services Licensee before making investment decisions. To the extent permitted by law, SEQ excludes all liability for any loss or damage arising in any way including by way of negligence.
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Source: Finance News Network