Energy and healthcare sectors lead the rally
U.S. stocks saw modest gains on Friday, 20 June 2014 pushing the S&P 500 and Dow industrials to the latest in a string of record closes and lifting the Nasdaq Composite to its strongest finish in 14 years. The energy, healthcare, industrial and financial sectors led the gains.
The Dow Jones Industrial Average gained 25.62 points, or 0.2%, to close at 16,947.08, also setting a record high and extending its win streak to six sessions the longest since December. The index gained a little more than 1% on the week. The Nasdaq Composite rose 8.71 points, or 0.2%,to end at 4,368.04. The tech-heavy index saw a 1.3% weekly rise. The S&P 500 rose 3.39 points, or 0.2%, to close at 1,962.87, bringing its win streak to six days and notching a record close for the third day in a row. The index rose 1.4% for the week.
Among major stocks, Software maker Oracle was among losers, slipping 1.7% after a disappointing earnings report.
Earlier in the week, equity indices closed the session close to where they began. The indecisive nature was attributed to some worrisome-sounding headlines on the geopolitical front, yet the market action suggested it may have been owed more to a case of wait-and-see in front of Wednesday's FOMC meeting.
The stock market ended the Tuesday session on a modestly higher note with participants gearing up for the latest policy directive from the FOMC. The major averages posted modest gains on Wednesday after the Federal Open Market Committee announced another $10 billion taper, which was widely expected. The $10 billion reduction lowered the size of monthly asset purchases to $35 billion, while the remainder of the policy statement struck a familiar tone.
The Fed reiterated its commitment to the current level of interest rates, saying rates are likely to remain low for a considerable time after quantitative easing ends. Furthermore, the FOMC released its economic projections, but those were not too different from the prior forecast either. According to the projections, the Fed expects the jobless rate to be between 6.0% and 6.1% at the end of the year after calling for a rate between 6.1% and 6.3% in its last set of projections.
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Bullion prices ended higher on Friday, 20 June 2014. Gold futures inched up on Friday, holding above the $1,300 level amid ongoing violence in Iraq and the likelihood of steady U.S. interest rates for a while.
Gold for August delivery added $2.50, or 0.2%, to settle at $1,316.60 an ounce on the Comex division of the New York Mercantile Exchange. The yellow metal gained 3.3% for the week, with a big jump coming Thursday, when gold pushed above the $1,300 level to a two-month high. July silver added 30 cents, or 1.5%, to settle at $20.95 an ounce.
On Friday, U.S. crude-oil rallied on Friday, 20 June 2014 closing at the highest level in nine months as worries about Iraq simmered and Brent futures slipped back below $115 a barrel to end a seven-day winning streak. Nymex July rose 83 cents, or 0.8%, to close at $107.26 a barrel. The August contract rose 78 cents to settle at $106.83 a barrel.
Iraq's government was desperately trying to hold off the extremists at the Beijing oil refinery and by late Thursday the two sides held different parts of the refinery, which extends over several square kilometers of desert some 250 kilometers (155 miles) north of Baghdad. The facility has a capacity of 320,000 barrels a day, accounting for a quarter of Iraq's refining capacity. While all its output is used domestically, a prolonged shutdown could force the energy producer to import oil products to keep up with the country's needs, cutting into global supplies.
On the fixed income side, the 10-yr note edged up one tick with its yield ending at 2.62%.
Participation was well above average, but that was a function of today's quadruple witching and S&P rebalancing. As a result, more than 1.7 billion shares changed hands at the NYSE floor.
On Monday, the Existing Home Sales report will be released at 10:00 ET.
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