NEW YORK: Wall Street stocks finished higher on Thursday (Aug 18) after a choppy session as investors weighed prospects for further upward movement following mixed earnings.
Equities opened lower, amid expectations the market would need to “digest” recent gains, but prices fluctuated throughout the session.
“It’s meandering in low volume for sure,” said Art Hogan, chief market strategist at B Riley Wealth Management, adding that there has been relatively light economic news.
“We’re in the summer doldrums,” he said. “I’m not surprised to see this market action the way it is.”
The Dow Jones Industrial Average rose 18.72 points, or 0.06%, to 33,999.04, the S&P 500 gained 9.7 points, or 0.23%, to 4,283.74 and the Nasdaq Composite added 27.22 points, or 0.21%, to 12,965.34.
Investors were still assessing Wednesday’s minutes from the Federal Reserve's July meeting, which they initially saw as supporting a less aggressive stance by the central bank. But the minutes did not clearly hint at the pace of rate increases and showed policymakers committed to raising rates to tame inflation.
“We’re at a point where people are trying to make a judgment about whether the inevitable higher interest rates are going to choke off the upside of the market,” said Rick Meckler, partner at Cherry Lane Investments in New Vernon, New Jersey.
“There are really two camps – one who feels the worst is behind us and continue to buy these selloffs, and the camp that feels the worst is ahead of us and like this is some kind of bear market rally that will retreat.”
Traders expect a greater chance of a 50 basis point rise in borrowing costs in September instead of a 75 basis point increase for a third time.
Supporting the view that the Fed may need to be more hawkish, data on Thursday showed solid momentum on the US economic front.
The Philadelphia Federal Reserve's monthly manufacturing index rose to 6.2 this month from negative 12.3 in July, topping all 30 estimates in a poll of Reuters economists.
Among individual companies, Dow-component Cisco Systems jumped 5.8% as the tech giant reported better-than-expected results and pointed to strong demand, with record orders. – AFP, Reuters
