NEW YORK, Aug 26 (Reuters) – The dollar rallied to a two-week high against the yen and Swiss Franc on Friday in volatile trading as investors focused on Federal Reserve Chair Janet Yellen’s comments on an improving US economy that bolstered the case for an interest rate increase. The Dow Jones Industrial Average lost 53.01 points, or 0.3%, to end at 18,396.40, with the blue-chip gauge swinging in a more then 200-point range on the day in a choppy session. Indeed, Yellen limited the bottom of her fan chart to 12.5 basis points, or 0.125 percent.
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The Standard & Poor’s 500 index slipped 3 points, or 0.2 percent, to 2,169.
Fischer said on CNBC TV that the Fed was still on track to raise rates this year. Elsewhere, the USA 10-year Treasury benchmark yield rose 5.9 basis points to its highest level since June 23, as government-bond traders appeared to take seriously the prospect of a rate hike as early as September.
The dollar rose against the yen to a two-week high of 101.93 yen and was last up 1.3 percent at 101.88 yen.
The report said gross domestic product increased by 1.1 percent in the second quarter, reflecting a downward revision compared to the originally reported 1.2 percent growth.
The Fed raised rates in December for the first time in almost a decade and projected another four hikes in 2016, only to scale that back to two moves in the wake of a global growth slowdown, financial market volatility and slow progress in meeting its 2 percent inflation goal. “That is very anemic”. A near 0.8 percent rise in technology .splrct and healthcare .spxhc stocks led the gains on the S&P. Federal regulators recently ordered the company to change its sales practices, but did not agree with Wall Street critics that it was a pyramid scheme.
Autodesk managed a small profit, beating expectations of a loss, and Pure Storage’s loss was far smaller than forecasts. Japan’s Nikkei 225 fell 1.2 percent after consumer prices fell the most in three years in July.
ONE MAN’S VIEW: “We’ve been in a bit of an earnings recession”, said Thomas Wilson, senior investment manager at Brinker Capital, but stocks are holding near record highs because financial analysts expect earnings to “go up” toward the end of the year. Hong Kong’s Hang Seng index rose 0.4 percent. The price of West Texas Intermediate oil, the US benchmark, was up 20 cents to $47.53, while the price of Brent crude, the global benchmark, increased 5 cents to $49.72.
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Trading in bonds and equities has remained becalmed all week as investors looked ahead to Yellen’s speech, set for 10 a.m. The euro rose to $1.1291 from $1.1285.
