USA stocks climbed on Thursday, led by big tech names, building on gains from a day earlier that were fueled by the Federal Reserve’s decision to stand pat on interest rates.
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Investors were surprised earlier this month when Fed official Eric Rosengren, who has been reluctant to raise rates, suggested he might be willing to raise rates this month.
KB BEAT: KB Home added 34 cents, or 2.3 percent, to $15.27 after the homebuilder disclosed strong results.
The Dow Jones Industrial Average was up 58.55 points, or 0.32 per cent, at 18,188.51. The Canadian dollar weakened sharply against its USA counterpart on Friday as the loonie was pressured by raised bets for a Bank of Canada rate cut as oil prices fell and domestic data disappointed.
As of 2033 BST, the dollar/yen was still sharply lower, changing hands at 100.55 and down by 1.28% after having registered gains earlier in the same session.
The FOMC kept interest rates at 0.25-0.5 percent as widely expected but laid down the groundwork for an increase in the coming months. For the week, it rose 0.3 percent, accounting for gains in the past two sessions. The yield on the 10-year Treasury note fell to 1.67% from 1.69%.
Gold edged down on Friday, after touching a two-week high in the previous session, on a stronger dollar, but was on track for its biggest weekly gain in almost two months. The yen fell then ultimately rose against its US counterpart. Market pricing for a December move rose only a fraction to 59.3 percent from 59.2 percent, according to CME Group’s FedWatch tool.
MSCI’s all-country world stock index was up 1.3 percent, while Europe’s STOXX 600 (.STOXX) was up 1.8 percent. The technology giant’s stock rose 60 cents, or 1.1%, to $57.41. Natural gas gained 1 cent to $3.06 per 1,000 cubic feet.
“We are still very well supplied for this time of year”, said Tariq Zahir, trader in crude oil spreads at Tyche Capital Advisors in NY.
The OECD estimates USA growth at 1.4 per cent this year, down from 1.8 per cent in its June outlook, with the growth outlook for 2017 falling to 2.1 per cent from the previous forecast of 2.2 per cent.
Gold rose $13.20, or 1 percent, to $1,331.40 an ounce.
“Gold and silver are both in need of corrective balancing and traders need to be on the look-out for several Fed speeches today as precious metals and other commodities have already priced in a dovish Fed and some doubt on that subject today could exaggerate the initial corrective tilt”, The Hightower Report noted.
The Fed, meanwhile, has forecast 1.8 per cent growth in 2016 and two per cent over the next two years.
Spot gold dropped 0.2 percent to $1,334.41 an ounce by 0411 GMT; but was on track for a weekly gain of almost 2 percent, the highest since end-July.
NYSE advancing issues outnumbered decliners by a 6.26-to-1 ratio; on Nasdaq, a 2.65-to-1 ratio favoured advancers.
Shares of Apple rose 0.9 percent to $114.56 and was the top influence on the S&P and the Nasdaq after Nomura and RBC raised their price targets.
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Earlier, the euro touched its highest level against the dollar in almost a week at $1.1250.
