US stocks jump as Fed decision edges closer
NEW YORK—Wall Street stocks finished with decisive gains Tuesday on modestly higher US retail sales ahead of the Federal Reserve’s interest rate decision later this week.
The Dow Jones Industrial Average advanced 228.89 points (1.40 percent) to 16,599.85.
The broad-based S&P 500 jumped 25.06 (1.28 percent) to 1,978.09, while the tech-rich Nasdaq Composite Index rose 54.76 (1.14 percent) to 4,860.52.
US retail sales rose 0.2 percent in August, boosted by robust auto sales, but slightly below analysts’ consensus estimate.
The retail sales report was one of the few remaining US data points ahead of the Fed’s two-day monetary policy meeting that begins Wednesday. The central bank will announce Thursday whether it will lift its key rate for the first time since 2006.
Peter Cardillo of Rockwell Global Capital said investors are ready for the Fed to finally act after months of talking about raising interest rates this year.
“Maybe the market is basically saying this about the Fed: ‘Raise interest rates, get this over with,'” he said.
Petroleum-linked stocks rose with oil prices. Dow member Chevron jumped 1.9 percent, Transocean gained 5.2 percent and ConocoPhillips added 1.1 percent.
Large banks also gained, including Dow member JPMorgan Chase (+1.9 percent), Bank of America (+2.2 percent) and Citigroup (+2.0 percent).
Aluminum giant Alcoa rose 2.7 percent and Ford surged 3.9 percent after the two companies announced they will collaborate to develop new aluminum alloy technology for the auto industry.
Fast-food chain Sonic tumbled 8.3 percent as it announced that same-store sales for the fourth-quarter increased 4.9 percent, below the 5.0 percent projected by analysts.
Alibaba gained 3.6 percent, rebounding from a 3.1 percent drop in the prior session.
Bond prices slid. The yield on the 10-year US Treasury rose to 2.28 percent from 2.19 percent Monday, while the 30-year advanced to 3.06 percent from 2.95 percent. Bond prices and yields move inversely.
Subscribe to INQUIRER PLUS to get access to The Philippine Daily Inquirer & other 70+ titles, share up to 5 gadgets, listen to the news, download as early as 4am & share articles on social media. Call 896 6000.