Apple-inspired rally in the tech sector helped lift the broader market
US stocks finished higher on Thursday, 15 September 2016 near their intraday highs, as an Apple-inspired rally in the tech sector helped to lift the broader market following a deluge of macroeconomic reports. The three main benchmarks on Thursday marked their fourth move of at least 1% in the past five sessions, after more than a month of torpor as volatility escalates in September. Earlier in the session, investors were training their focus on retail sales, which showed a decline in Augustthe first since March. Meanwhile a weekly report on jobless claims ticked higher but remained at historically low levels. And, producer prices remained flat, suggesting lack of inflation pressures.
Earlier, stocks had traced fluctuations oil prices, but West Texas Intermediate ended settling up 0.8% at $43.91 a barrel. Slumping crude-oil prices weighed on stocks on Wednesday, leaving the Dow Industrials and the S&P 500 to close in negative territory.
The Dow Jones Industrial Average closed up 177.71 points, or 1%, at 18,212.48. The S&P 500 index wrapped up 21.49 points, or 1%, to 2,147.26. The Nasdaq Composite Index enjoyed the sharpest rise among its peers, closing 75.92 points, or 1.5%, higher at 5,249.69.
All 30 of the Dow components finished in the green. The tech rally was led by a 3.4% surge in shares of Apple. All of the main indexes benefited from Apple's consistent weekly jumpits fourth consecutive rise of at least 2%. For this week alone, shares are up 12%.
The Cupertino, California based tech giant, Apple has been among best performing shares this week, following strong demand for its new iPhones and upbeat analyst comments. Apple tends to do well in times of market volatility, which has been a major theme this week.
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The U.S. central bank is widely expected to hold fire next week when it meets. There won't be any comments from Fed officials in the run-up to the meeting as the central bank is in its so-called blackout period.
A broad index for the greenback switched between gains and losses on Thursday. The buck was slightly weaker versus the yen. It gained ground against the U.K.'s sterling after the Bank of England left rates and bond-buying untouched but cracked the door open for a future rate cut.
The flurry of economic reports Thursday included a closely watched snapshot of retail sales. Sales at U.S. retailers fell 0.3% in August and declined for the first time in five months. U.S. producer prices were flat in August, while regional manufacturing gauges measuring conditions in the New York area and Philadelphia both showed improvement. Economic data can sway the Fed's decisions on interest rates.
Weekly jobless claims ticked up slightly to 260,000 but the level of layoffs continues to be the lowest since the 1970s. U.S. wholesale prices were flat in August, mostly because of sharp declines in the cost of food and gasoline. The Empire State manufacturing index, which measures conditions in the New York area, remained in contraction territory. Industrial production contracted in August after a promising expansion in the previous two months, the Federal Reserve said Thursday.
Crude oil prices ended mildly higher at Nymex on 15 September 2016. Gasoline futures rallied Thursday by more than 5%, providing a lift to oil prices following a two-session decline, as the shutdown of a key pipeline looked set to stretch into a full week. The temporary closure of the Colonial Pipeline Line 1, which transports 1.2 million barrels of gasoline a day from Texas as far as New Jersey, began last Friday because of a leak.
October West Texas Intermediate crude rose 33 cents, or 0.8%, to settle at $43.91 a barrel on the New York Mercantile Exchange after tallying a loss of nearly 6% in the past two sessions. November Brent on the ICE Futures exchange in London added 74 cents, or 1.6%, to $46.59 a barrel.
Early Thursday, oil prices were pressured by some strength in the dollar and expectations for higher global production, as downbeat U.S. economic data spurred concerns over the prospects for energy demand.
Bullion prices ended lower on Thursday, 15 September 2016. Gold prices dropped to mark a sixth loss in seven sessions as investors sifted through the latest deluge of U.S. economic data in the run up to next week's meeting of the Federal Reserve. A deluge of macroeconomic reports drew into focus the near-term picture for interest rate-sensitive trading in currencies and metals. Both the Federal Reserve and the Bank of Japan are slated to hold policy meetings next week, which could influence the buck and dollar-priced assets like metals.
December gold fell $8.10, or 0.6%, to settle at $1,318 an ouncethe lowest level in two weeks. December silver fell 2.5 cents, or 0.1%, to $19.041 an ounce.
Treasuries ended on a mixed note. The yield on the 2-yr note fell two basis points to 0.74% while the yield on the 10-yr note finished flat at 1.70%.
Today's participation was above the recent average as more than 819 million shares changed hands on the NYSE floor.
Tomorrow's economic data will include CPI for August (consensus +0.1%) and the preliminary reading of the Michigan Sentiment Index for September (consensus 91.5), which will cross the wires at 8:30 ET and 10:00 ET, respectively. Separately, Net Long-Term TIC Flows for July will be released at 16:00 ET.
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