US close: S&P 500 rises for a sixth day ahead of the Fed
Wall Street continued pushing higher ahead of the US central bank´s policy meeting the following week and a meeting of non-OPEC oil producers, on Saturday, to decide on a further reduction in global crude oil supplies.
The Dow Jones Industrial Average gained 0.72% or 142.04 points to close at 19,756.85, while the S&P clocked in with a sixth consecutive session of gains, rising 0.59% or 13.34 points to end at 2,259.33, while the Nasdaq Composite tacked on 0.50% or 27.14 points to end the day at 5,444.50.
Some analysts indicated a correction could be on the cards for US stocks following recent highs.
Ipek Ozkardeskaya, senior market analyst at London Capital Group, said: “US stocks extended gains to fresh historical highs. The relative strength index hint at deepening overbought conditions in the US stock markets, suggesting that the time for a correction could be approaching.”
Shares ended in the black on Thursday after the European Central Bank announced the extension of its quantitative easing programme. ECB chief Mario Draghi said the central bank would keep buying government bonds through next year, albeit at lower amounts each month from April.
The ECB said it will buy €60bn a month in government bonds from April 2017 until December 2017, compared to €80bn currently.
With the ECB out of the way, attention will shift to next week’s announcement from the Federal Reserve, which is widely expected to hike rates.
Oanda’s Craig Erlam said: “The key to the meeting is likely to be how many rate hikes the Fed is forecasting for next year given that markets are currently only pricing in one by November, which I think is too few. Given the Fed’s bullish forecast for four last year and the much improved conditions this time around, it will be interesting to see what approach they take.”
In corporate news, Restoration Hardware Holdings tumbled after it cut its outlook for the fourth quarter late on Thursday.
From a sector standpoint, the biggest gains were seen in the following groups: Platinum (17.98%), Drug retailers (2.36%) and Mortgage Finance (2.09%).
Meanwhile, oil prices were in the black ahead of a meeting of OPEC and non-OPEC members on Saturday to discuss production. West Texas Intermediate closed 58 cents higher to $51.50 a barrel.
The preliminary reading on the University of Michigan´s consumer confidence gauge for the month of December showed an improvement from 93.8 points in the month before to 98.0 (consensus: 94.0).
"Overall, the underlying details of this morning’s release suggest that consumer confidence remains on solid footing and is supportive of firm GDP growth in the near term," Barclays Research said in a report sent to clients.
The yield on the benchmark 10-year US Treasury bond rose six basis points to 2.47%.
Dow Jones - Risers
Coca-Cola Co. (KO) $42.00 2.49%
Pfizer Inc. (PFE) $31.70 2.46%
Merck & Co. Inc. (MRK) $61.23 1.85%
Apple Inc. (AAPL) $113.95 1.63%
Microsoft Corp. (MSFT) $61.97 1.57%
3M Co. (MMM) $178.49 1.48%
Walt Disney Co. (DIS) $104.86 1.43%
United Technologies Corp. (UTX) $109.79 1.25%
Johnson & Johnson (JNJ) $112.26 1.14%
Procter & Gamble Co. (PG) $84.37 1.04%
Dow Jones - Fallers
Caterpillar Inc. (CAT) $95.53 -0.77%
Wal-Mart Stores Inc. (WMT) $70.08 -0.37%
American Express Co. (AXP) $74.77 -0.19%
Visa Inc. (V) $79.14 -0.18%
Goldman Sachs Group Inc. (GS) $241.85 0.17%
Intel Corp. (INTC) $35.76 0.17%
E.I. du Pont de Nemours and Co. (DD) $74.85 0.23%
Nike Inc. (NKE) $51.72 0.33%
Cisco Systems Inc. (CSCO) $30.06 0.37%
JP Morgan Chase & Co. (JPM) $85.49 0.43%