NEW YORK, March 18 ― The S&P 500 and Nasdaq extended last week’s gains today, lifted by technology and financial stocks, as investors waited for the Federal Reserve’s policy meeting later this week for further clues on the pace of interest rate hikes.
The Dow was pressured by Boeing Co, which fell 2.7 per cent after Ethiopia said an initial analysis of black boxes showed “clear similarities” in the March 10 plane crash with October’s accident in Indonesia.
Concerns over the safety of Boeing’s money-spinning MAX 8s led to the aircraft’s grounding around the world last week, shaving off more than 10 per cent from the market value of the world’s largest planemaker.
Facebook Inc dropped 3 per cent after a top-rated analyst cut rating on the company’s stock to “hold” and dragged the communication services sector 0.57 per cent lower, the most among 11 major S&P sectors.
Apple Inc rose 0.6 per cent after the iPhone-maker launched a new 10.5-inch iPad Air in a surprise move today.
Apple boosted the tech sector, up 0.47 per cent, which along with the financial sector offered the biggest support to the S&P 500.
At 9:46am ET the Dow Jones Industrial Average was down 10.57 points, or 0.04 per cent, at 25,838.30. The S&P 500 was up 6.45 points, or 0.23 per cent, at 2,828.93 and the Nasdaq Composite was up 18.86 points, or 0.25 per cent, at 7,707.39.
“The focus for the week is obviously the Fed which is going to lean to the optimistic side and will probably also cut (interest rates) later on, but not nearly enough to set off panic about lower rates,” said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.
The Federal Reserve’s two-day policy meeting begins tomorrow, where the central bank is widely expected to stick to its pledge of a “patient” approach to monetary policy.
Investors will be looking for whether policymakers will have sufficiently lowered their interest rate forecasts to more closely align to the Fed’s “dot plot”, a diagram showing individual policymakers’ rate views for the next three years.
Also expected are more details on a plan to stop cutting the Fed’s holdings of nearly US$3.8 trillion in bonds.
This follows a batch of weak economic data last week that validated the Fed’s decision to remain less aggressive on raising rates. The dovish stance along with optimism on trade helped the S&P 500 and Nasdaq end last week at a five-month high and notch their best weekly gain this year.
The benchmark index now remains just 3.6 per cent away from its all-time closing high in September.
Edwards Lifesciences Corp jumped 8.5 per cent, the most among S&P stocks, after trial results showed that the company’s non-invasive heart valve replacement system was superior to surgery.
Advancing issues outnumbered decliners for a 2.79-to-1 ratio on the NYSE and a 1.83-to-1 ratio on the Nasdaq.
The S&P index recorded 21 new 52-week highs and no new low, while the Nasdaq recorded 49 new highs and 12 new lows. ― Reuters
