MARKET SNAPSHOT: U.S. Stocks End Higher As Upbeat Fed Report Soothes China Jitters
September 02 2015 - 5:37PM
Dow Jones News
By Sue Chang and Anora Mahmudova, MarketWatch
Nasdaq returns to positive territory for the year
U.S. stocks rallied on Wednesday as a Federal Reserve report
painted a more optimistic economic picture, soothing worries about
the possible impact of the slowdown in China on the U.S.
The Federal Reserve's Beige Book said
(http://www.marketwatch.com/story/feds-beige-book-finds-wage-pressure-and-china-dollar-concerns-2015-09-02)
several district banks "reported increasing wage pressures caused
by labor market tightening" a change from earlier reports that
noted higher pay in isolated sectors. But there were also
indications that the strong dollar and the drop in oil prices were
depressing activity, which could argue for holding off on raising
interest rates at the Sept. 16-17 policy meeting.
"If the markets were looking for significant spillover from
China or significant deterioration in U.S. economy in latest Beige
Book, it's not there," said John Canally, chief economist
strategist at LPL Financial.
The S&P 500 closed up 35.01 points, or 1.8%, to finish at
1,948.86. The Dow Jones Industrial Average gained 293.03 points, or
1.8%, to end at 16,351.38, while the Nasdaq Composite Index picked
up 113.87 points, or 2.5%, to close at 4,749.98, put the tech laden
back in positive territory.
Anticipation that the European Central Bank could announce
further stimulus on Thursday also helped to lure some investors
back to the stock market, according Ian Winer, director of equity
trading at Wedbush Securities.
The ECB will hold its regular policy meeting Thursday morning,
followed by a news conference.
Read: 5 things to watch at Thursday's ECB meeting
(http://www.marketwatch.com/story/5-things-to-watch-at-thursdays-ecb-meeting-2015-09-02)
Also read:One in five S&P 500 stocks now in bear-market
territory for 2015
(http://www.marketwatch.com/story/one-in-five-sp-500-stocks-now-in-bear-market-territory-for-2015-2015-09-02)
The market was higher from the opening bell after U.S. data
showed solid private-sector job gains in August and a jump in
productivity growth in the second quarter.
A somewhat stable trading session in China ahead of the
country's long holiday weekend also helped. The Shanghai Composite
Index slipped 0.2%
(http://www.marketwatch.com/storyno-meta-for-guid), and China's
stock markets are closed Thursday and Friday
(http://www.marketwatch.com/story/china-to-close-stock-market-to-honor-world-war-ii-anniversary-2015-09-01)
for the World War II Victory Day parade.
Wednesday's data and the Beige Book as well as the monthly
payrolls report due Friday are among the last economic news before
the Federal Reserve makes a decision on interest rates at its
two-day policy meeting starting Sept. 16.
Michael Arone, chief investment strategist at State Street
Global Advisors, speculated that the jobs report may not provide
more clarity to investors. "It is likely to be in line with
consensus estimate, but won't give investors a definitive answer as
to what the Fed is likely to do. Until there is clarity about the
rate policy, we expect volatility to continue in the near term," he
said.
Read:Where every Fed member stands on raising interest rates
(http://www.marketwatch.com/story/where-every-fed-member-stands-on-raising-interest-rates-2015-08-28).
U.S. data: Private-sector employment gains continued in August
(http://www.marketwatch.com/story/private-sector-adds-190000-jobs-in-august-adp-2015-09-02-8911922)
at a slightly faster pace than in July. Employers added 190,000
jobs last month, Automatic Data Processing Inc.reported
Wednesday.
U.S. productivity in the second quarter rose at the fastest pace
since the end of 2013
(http://www.marketwatch.com/story/us-productivity-rises-at-fastest-pace-since-end-of-2013-2015-09-02).
Factory orders rose 0.4% in July, marking the second month of gains
after a strong June
(http://www.marketwatch.com/story/factory-orders-rise-for-second-month-in-july-2015-09-02).
Movers and shakers: Apple Inc. (AAPL) climbed 4.3% and Microsoft
Corp. (MSFT) gained 3.7%, underpinning the Dow's rise.
Shares of H&R Block Inc. (HRB) jumped more than 7% after the
company announced a new $3.5 billion stock repurchase program.
After Tuesday's closing bell, AT&T Inc.(T) said TRC Capital
Corp. has made an unsolicited "mini-tender" offer
(http://www.marketwatch.com/story/att-recommends-shareholders-reject-trc-capitals-3-million-share-mini-tender-offer-2015-09-01)
to buy up to three million of the telecom company's shares.
Intel Corp.(INTC) rose 2.8% after the tech giant late Tuesday
said it is overhauling its flagship line of computer chips
(http://www.wsj.com/articles/intel-overhauls-chips-in-bid-to-revive-pc-sales-1441155601).
Other markets: October WTI crude recovered to add 84 cents, or
1.9%, to settle at $46.25 a barrel on the New York Mercantile
Exchange Gold lost $6.20, or 0.5%, to settle at $1,133.60 an ounce
on Comex, while the ICE dollar index edge up 0.1% to 95.90.
Sara Sjolin contributed to this article.
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(END) Dow Jones Newswires
September 02, 2015 17:22 ET (21:22 GMT)
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