NEW YORK - Investor optimism over US tax reforms and the global economy spurred Wall Street and world stock markets to fresh highs on Thursday, while the dollar gained as data pointed to solid US economic growth.
The Dow, S&P 500 and Nasdaq stock indexes notched record-high closes for a fourth consecutive day, as did MSCI's gauge of equity markets in 47 countries, as rosy economic data and budding signs US tax reform legislation will pass cheered investors.
The Republican-controlled Congress hastened the overhaul of the US tax code by moving closer to agreement on a budget resolution, taking a procedural step that would help advance eventual tax legislation.
US investors are warming to the notion that a new fiscal policy will be in place by the first quarter, said Phil Orlando, chief equity strategist at Federated Investors in New York.
Most investors felt that nothing would come of President Donald Trump's tax reform effort until last week, he said.
"It sounds like they're serious about drafting tax reform legislation and that gives everyone greater confidence that this might actually might happen," Orlando said.
Tax reform could lift economic growth and corporate earnings estimates for 2019, and push his S&P 500 target above 3,000 for that year, Orlando said.
The S&P 500 rose for an eighth straight session and set a sixth consecutive record closing high, the longest such streak since an eight-day run in 1997.
The Dow Jones Industrial Average rose 113.75 points, or 0.5 percent, to end at 22,775.39. The S&P 500 gained 14.33 points, or 0.56 percent, to 2,552.07 and the Nasdaq Composite added 50.73 points, or 0.78 percent, to 6,585.36.
MSCI's all-country world stock index gained 0.24 percent. In Europe, the pan-regional FTSEurofirst 300 index rose 0.2 percent to close at 1,536.56.
A Reuters poll found sentiment that global stocks will continue to climb over the coming year on rising optimism about growth worldwide. However, a slim majority of equity strategists also expect the current eight-year bull run to end in 2018.
"There really is no alternative to being in the equity market," said Larry Hatheway, chief economist at GAM Investment Management in Zurich.
"There's no reason for anybody to sell equities at this point in time. There are no threats to an equity bull market that seem to be material," he said.
The US trade deficit fell in August as exports of goods and services rose to the highest in more than 2-1/2 years. Separately, the number of Americans filing for unemployment benefits fell more than expected last week.
Gold dipped on news of the data as it bolstered the notion US interest rates will be raised in December. Philadelphia Federal Reserve Bank President Patrick Harker said he was penciling in one more rate increase this year and three in 2018.
US gold futures for December delivery settled down $3.60 at $1,273.20 per ounce.
The dollar index, tracking the greenback against a basket of key currencies, held under seven-week highs as investors awaited Friday's US payrolls report for September to assess the impact of hurricanes Harvey and Irma. The storms proved a drag on robust business spending that was seen in the trade data.
The dollar index rose 0.53 percent, with the euro down 0.47 percent at $1.1704. The Japanese yen weakened 0.08 percent versus the greenback to 112.83 per dollar.
Oil prices rose as signs Saudi Arabia and Russia will limit production through next year overshadowed record US exports and the return of production at a major Libyan oilfield.
Brent rose $1.20 to settle at $57.00 per barrel, while US crude settled at $50.79, up 81 cents.
source: news.abs-cbn.com
NEW YORK - Wall Street rebounded on Thursday from its biggest sell-off in more than eight months, helped by strong US economic data, but uncertainty over US President Donald Trump's agenda kept an index of global equity markets near a three-week low.
The US dollar reversed early losses against a basket of major currencies after stronger-than-expected US economic data put the focus back on a widely anticipated increase in interest rates by the Federal Reserve.
Still, reports that US President Donald Trump had tried to intervene in an investigation of alleged Russian meddling in last year's US presidential election, and that his aides had numerous undisclosed contacts with Russian officials, kept markets concerned over his ability to implement his economic agenda.
Adding to market jitters across the Americas, Brazilian stocks triggered a 30-minute halt to trading after the benchmark Bovespa index fell 10 percent following a report that President Michel Temer gave his blessing to an attempt to pay to silence a potential witness in the country's biggest-ever graft probe.
The iShares MSCI Brazil ETF tumbled 16 percent.
MSCI's all-country world equity index was down 0.31 percent after dipping to its lowest since April 25 earlier in the day.
The index found some support on Wall Street. US stocks recovered ground after a near 2 percent sell-off on Wednesday for the S&P 500, as upbeat economic data emboldened investors to return to the market.
"We could be just shaking off the jitters here. Yesterday, investors were really worried," said Janna Sampson, co-chief investment officer at OakBrook Investments LLC in Lisle, Illinois.
Investors were likely relieved, she said, by Wednesday night's appointment of former FBI chief Robert Mueller to investigate alleged Russian interference in the election and possible collusion between Trump's campaign and Moscow.
"Whatever the (investigation) result, people feel they might have confidence it's an accurate, unbiased result," she said.
Earlier in the day, the Philadelphia Federal Reserve said its business activity index rose in May after declining for two months. Weekly unemployment data also pointed to strength in the labor market.
The Dow Jones Industrial Average rose 56.09 points, or 0.27 percent, to end at 20,663.02, the S&P 500 gained 8.69 points, or 0.37 percent, to finish at 2,365.72 and the Nasdaq Composite added 43.89 points, or 0.73 percent, to close at 6,055.13.
The pan-European FTSEurofirst 300 index closed down 0.89 percent at 7,436.42, ending off lows.
US Treasury yields rose from one-month lows as stocks recovered from Wednesday's drop, reducing demand for safe-haven bonds.
The 10-year note was down 4/32 in price to yield 2.229 percent, up from 2.216 percent late on Wednesday.
Spot gold dropped 1 percent to $1,247.78 an ounce.
The US dollar reversed early losses against a basket of major currencies, getting a boost from the better-than-expected US data.
"The readings on jobless claims and the Philly Fed index back expectations for faster (second-quarter) growth and a Fed rate hike next month," said Joe Manimbo, senior market analyst at Western Union Business Solutions in Washington.
The dollar index was up 0.27 percent, with the euro down 0.45 percent to $1.1108.
Oil prices settled higher as key producing countries suggested they would extend supply cuts to reduce an ongoing global crude glut.
Benchmark Brent crude futures ended the session 30 cents higher at $52.51 a barrel while US crude futures settled up 28 cents at $49.35.
source: news.abs-cbn.com
