NEW YORK (AFP) – Wall Street stocks edged up to fresh records on Tuesday (Sept 19) as the bull market marched onwards following solid economic data while the Federal Reserve opened a two-day policy meeting.
All three major indices finished at records, with the Dow Jones Industrial Average rising 0.2 per cent to 22,370.80, its sixth straight record.
The broad-based S&P 500 rose 0.1 per cent to 2,506.65, while the tech-rich Nasdaq Composite Index advanced 0.1 per cent to 6,461.32.
Analysts attribute the latest run of all-time highs to improving economic data, better corporate earnings and increased talk out of Washington about a long-awaited Republican tax cut plan.
That has allowed investors to brush off continued worries about geopolitical issues. On Tuesday, President Donald Trump escalated his rhetoric on North Korea, threatening to “totally destroy” the country if it doesn’t back down on its nuclear ambitions.
“The market remains extremely strong,” said Adam Sarhan, chief executive of 50 Park. “It continues to dismiss all negative headlines – North Korea and geopolitical tensions, gridlock in Washington, two major hurricanes, a series of weaker than expected data. The bulls are still in control.”
While the Fed is not expected to announce a change in interest rates, analysts are girding for it Wednesday to begin tapering its multi-trillion-investment holdings – ending a stimulus program put in place after the global financial crisis and tightening the money supply.
US data showed a dip in housing starts in August due in part to Hurricane Harvey, but building permits for construction in the pipeline hit the highest level since January, according to the Commerce Department.
Banking shares were strong, with JPMorgan Chase winning 1.1 per cent, Bank of America 0.7 per cent and Citigroup 0.8 per cent.
Best Buy slumped 8 per cent as Wall Street frowned on its long-term outlook. The electronics retailer said it would cut US$600 million in annual costs through 2021 and that it would garner an eight to nine per cent growth in per-share earnings in 2021 compared with 2017.
Toymakers Mattel and Hasbro bounced after both slid on rumors ahead of the rumored bankruptcy of Toys “R” Us, which was announced Monday night. Both companies rose more than 1 per cent.