By Barbara Kollmeyer and Anora Mahmudova, MarketWatch
NEW YORK (MarketWatch) -- The U.S. stock market rallied on
Friday, sending the S&P 500 and Dow Jones Industrial Average
into record territory, after a surprise stimulus plan from the Bank
of Japan was announced.
Some analysts noted that the recovery from the recent pullback,
which sent the S&P 500 down nearly 8% early this month, was the
second fastest recovery since 2010. The main benchmarks finished
the week and the month higher.
The measures announced by Japan appeared to encourage investors,
who have been looking for regions like Europe and Asia to take
further steps toward boosting flagging growth, as the Federal
Reserve wraps its own stimulus program.
The S&P 500 (SPX) closed at a record high, having rung up a
new closing high every month since June 2013, according to Howard
Silverblatt, senior index analyst at S&P Dow Jones Indices.
The benchmark index gained 23.27 points, or 1.2%, to 2,017.92 on
Friday.
The Dow Jones Industrial Average (DJI) also closed at a record
level, having hit an intraday high in morning session. The
blue-chip index rose 194.71 points, or 1.1%, to 17,390.13, and
recorded its biggest weekly gain in nearly two years. The Dow swung
wildly during October - moving triple-digits 16 times out of 23,
but still ended the month higher.
The Nasdaq Composite (RIXF) rallied 64.60 points, or 1.4%, to
4,630.74 and closed at the highest level since March 2000.
Global stocks were boosted by the Bank of Japan's surprise
increase in its stimulus, with the Nikkei 225 index soaring nearly
5%. The BOJ board voted 5-4 in favor of increasing the central
bank's annual asset purchases to 80 trillion yen, from a prior
target range of Yen60 trillion to Yen70 trillion, amid worries
about dwindling inflation and downbeat economic data.
Investors did not dwell on softer-than-expected economic reports
on consumer spending and labor costs. Consumer spending in the U.S.
fell in September for the first time in eight months, while
employment costs rose for the second straight quarter to mark the
biggest back-to-back gain since 2008.
"The U.S. sends 4.5% of it exports to Japan, and so any action
that can: (a) ward off the threat of deflation and the crippling
effect that has on consumer expenditure; (b) give a boost to the
Japanese economy, which is the world's third largest, has to be
seen as a strong positive for future earnings potential," said
Stephen Pope, managing partner at Spotlight Ideas.
More data at month's end: The final October reading on the
University of Michigan/Thomson Reuters consumer-sentiment index
rose to the highest level since July 2007.
Separately, Chicago PMI rose to a one-year high in October,
helped by gains in new orders, MNI Indicators said Friday.
Stocks to watch: GoPro Inc. (GPRO) surged after results topped Wall Street estimates.
AbbVie Inc. (ABBV) shares rallied after the company said sales
and profit beat analyst forecasts.
Madison Square Garden Co. (MSGNV) shares rose after its fiscal
first quarter revenue far surpassed analyst estimates. The company
is currently considering splitting itself in two.
Starbucks Corp. (SBUX) is down after its first-quarter outlook
fell below forecasts.
Shares of Apple Inc. (AAPL) hit an intraday record in morning
trade and shares gained 34% since the start of the year.
Gold sinks as dollar soars: Gold prices (GCZ4) were trading at
levels not seen since 2010, dropping nearly $34 to $1,164.30, with
the dollar (USDJPY) trading around Yen112.01. Oil (CLZ4) also
pulled back 1.5%. Asian markets were higher, with the Nikkei
closing at its highest level in nearly seven years, on the back of
the Japanese stimulus. European stocks rallied along with global
stocks.
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