December 22, 2014
Dow, S&P 500 rise after Federal Reserve minutes reassure on rates
US stocks ended mostly higher, with the S&P 500 just missing a record close, after minutes from the Federal Reserve's July meeting gave investors reason to believe that the central bank is in no rush to raise interest rates.
The minutes were from the two-day meeting of the Federal Open Market Committee in late July, when the Fed trimmed its monthly bond-buying program by an additional $10 billion.
Stocks pared gains immediately after the release of the minutes, but the Dow and the S&P 500 returned to positive territory with a little more than an hour of trading left in the regular session.
The S&P 500 barely missed its record close of 1,987.98 and finished within 5 points of its all-time intraday high of 1,991.39, both set on July 24.
With the minutes out, investors have turned their attention to the annual meeting of top central bankers in Jackson Hole, Wyoming, which will take place from Thursday through Saturday. Fed Chair Janet Yellen is expected to acknowledge during the conference that while economic data has generally been supportive, she remains concerned about slack in the labor market. She is scheduled to speak on Friday.
The Dow Jones industrial average rose 59.54 points, or 0.35 percent, to end at 16,979.13. The S&P 500 gained 4.91 points, or 0.25 percent, to finish at 1,986.51. The Nasdaq Composite dipped 1.03 points, or 0.02 percent, to close at 4,526.48.
The S&P retail index ended up 1.1 percent, marking its fifth gain in six sessions despite tepid results from some major retailers.
About 4.5 billion shares traded on all US platforms, according to BATS exchange data, compared with the five-day average of 5.2 billion.
European shares dipped today, ending a two-day rally, with investors rattled by Carlsberg's warning that profits would fall this year due to deteriorating conditions in Russia.
Further souring the market mood was the spectre of a major central bank raising interest rates as soon as at the start of next year after Bank of England minutes showed two of the bank's nine rate-setting policymakers voted for a hike this month.
Shares in Carlsberg fell 3.6 percent. The Danish brewer derives 35 percent of its profits from Russia, making it a test case of how European companies will be affected by tit-for-tat sanctions between the West and Russia over the conflict in Ukraine.
Shares in rival Heineken, however, surged 7.7 percent after it posted better-than-expected first-half operating profit, as it sped up cost savings and increased volumes in all regions bar Central and Eastern Europe.
Investors were wary about equities, hit in the last few weeks by fears of an escalation in the Ukrainian crisis which has revealed new vulnerabilities in Europe's stumbling economy.
The violence in Ukraine and sanctions against Russia, a major energy supplier to Europe, have muddied the forecasts of a number of multinationals including Henkel, Adidas and Rheinmetall.
The FTSEurofirst 300 index of top European shares was down 0.1 percent at 1,345.09 points, after gaining 1.8 percent in the past two sessions.
Stocks had been helped earlier this week by strong US housing data and soft UK inflation figures.
The euro zone's blue-chip Euro STOXX 50 index fell 0.3 percent to 3,081.09 points.
The FTSEurofirst 300 - which had tumbled 7 percent between late June and early August - has recovered nearly half of the slide, with the index testing the 50 percent Fibonacci retracement level on Wednesday, at 1,348.11 points.
Luxottica, the world's largest eyewear maker by revenue, shed 3.4 percent on reports that CEO Andrea Guerra may step down over differences of opinion with founder and chairman Leonardo Del Vecchio.
Luxottica declined to address Guerra's future. Guerra, widely seen as a driving force behind Luxottica's success in recent years, has been CEO since 2004.
Meanwhile, Germany's Infineon is poised to buy a US-based semiconductor company for about $2 billion, a person close to the deal told Reuters. Its shares fell 1.5 percent.
Meanwhile, Japanese stocks eked out a small gain to mark its longest winning streak since last December, though sentiment was subdued as many investors stuck to the sidelines ahead of a gathering of central bankers in Jackson Hole,
Wyoming. A weaker yen nudged the Nikkei share average up 0.03 percent to 15,454.45, the eighth straight day of gains.
The dollar rose to a session high of 103.27 yen - its strongest level since April. But the broader Topix inched down 0.05 percent to 1,279.64, while the JPX-Nikkei Index 400 slipped 0.02 percent to 11,650.01.