US close: Stocks rise ahead of inflation reading, Fed decision
Wall Street posted some decent gains by the close on Monday, as all the major indices ended in the green.
At the close, the Dow Jones Industrial Average was up 0.56% at 34,066.33 points, while the S&P 500 ascended 0.93% to finish at 4,338.93, reaching its highest level in over a year.
That was closely mirrored by the Nasdaq Composite, which jumped 1.53% to end the session at 13,461.92, marking its own yearly peak.
Monday’s performance was underpinned by the expectation of forthcoming announcements from key central banks across the globe, including the Federal Reserve, the European Central Bank, and the Bank of Japan.
In foreign exchange markets, the dollar saw marginal decreases across the board, falling 0.01% on sterling to trade at 79.93p, while it recorded an equivalent decline against the euro to 92.95 euro cents.
Additionally, it slipped slightly against the yen, last falling 0.01% to change hands at JPY 139.59.
“It has been a notably positive start to a busy week for financial markets,” said IG chief market analyst Chris Beauchamp.
“Stocks have opted to continue their move higher for the time being, expecting US inflation to cool slightly and the Fed to leave rates unchanged.
“Should those assumptions prove wrong we can expect significant volatility across stocks and in the dollar, with the latter likely to see further upside.”
Quiet day for US data as UK looks set to avoid recession
On the economic front, amid an absence of significant data releases stateside, focus shifted across the Atlantic as new data from two prominent organisations pointed to the UK potentially escaping a looming recession.
Both the Confederation of British Industry (CBI) and global auditing firm KPMG presented comparatively buoyant economic predictions for the UK.
The CBI reported an encouraging performance by the UK economy in the first half of the year, exceeding initial expectations and positioning the UK to evade a recession.
It adjusted its initial forecast, which anticipated a 0.4% contraction and 1.6% growth, to a more optimistic outlook predicting growth of 0.4% this year and an enhanced 1.8% in 2024.
The report highlighted strengthening "growth tailwinds" since their previous forecast in December and an anticipated decline in inflation over the year.
It also predicted a reduction in food inflation from the daunting 15.5% in 2023 to a more palatable 4.4% in 2024.
However, it warned of continued inflation threats primarily due to domestic price pressures and wage growth.
The CBI said it further expected the Bank of England to implement two more interest rate increases, pushing rates to 5% by August.
Echoing the CBI, KPMG's economic outlook suggested the UK was poised to avoid a recession, attributing that largely to declining energy prices and an enhanced global economic situation.
KPMG noted a tight labour market contributing to stable unemployment rates.
The firm predicted a modest GDP growth of 0.3% for this year and 1.1% for the following year.
However, KPMG warned that the pace of growth remained underwhelming in historical context and significant risks persisted, including stubbornly high inflation, currently standing at 8.7%, potential global banking system disruptions, and the uncertain effects of increased interest rates on the economy.
Chinook Therapeutics surges while Nasdaq tumbles on acquisition news
In equities, biopharmaceutical company Chinook Therapeutics rocketed 58.32% after it agreed to be acquired by Swiss multinational Novartis.
The deal, valued at up to $3.5bn, will see Chinook shareholders receive $40 per share, with an additional contingent value right of up to $4 per share.
The latter would be payable in cash on the achievement of specified regulatory milestones.
Chinook is noted for its two late-stage assets in development, designed for the treatment of a rare progressive chronic kidney disease.
Elsewhere, life science specialist Illumina edged up 3.79% after the abrupt resignation of its chief executive officer Francis deSouza over the weekend.
On the downside, Nasdaq Inc. tumbled 11.81% as investors absorbed news of its agreement to purchase Adenza, a financial software firm, in a deal valued at $10.5bn.
Reporting by Josh White for Sharecast.com.
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Intel Corp. (INTC) $33.07 5.52%
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Cisco Systems Inc. (CSCO) $50.48 1.65%
Apple Inc. (AAPL) $183.79 1.56%
Microsoft Corp. (MSFT) $331.85 1.55%
3M Co. (MMM) $101.26 1.36%
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Procter & Gamble Co. (PG) $145.41 -0.78%
Merck & Co. Inc. (MRK) $109.86 -0.77%
Salesforce.Com Inc. (CRM) $213.69 -0.75%
Amgen Inc. (AMGN) $217.36 -0.64%
Travelers Company Inc. (TRV) $174.81 -0.47%
Coca-Cola Co. (KO) $60.21 -0.43%
Unitedhealth Group Inc. (UNH) $492.72 -0.21%
Johnson & Johnson (JNJ) $159.90 -0.07%
JP Morgan Chase & Co. (JPM) $141.00 -0.01%
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Norwegian Cruise Line Holdings Ltd (NCLH) $18.41 7.22%
Broadcom Inc. (AVGO) $855.36 6.31%
Kohls Corp. (KSS) $23.43 6.21%
Oracle Corp. (ORCL) $116.43 5.99%
Intel Corp. (INTC) $33.07 5.52%
Advance Auto Parts (AAP) $66.89 5.21%
Arista Networks Inc. (ANET) $170.00 4.60%
Adobe Systems Inc. (ADBE) $474.63 4.54%
Seagate Technology Plc (STX) $63.41 4.14%
S&P 500 - Fallers
Fiserv Inc. (FI) $114.23 -100.00%
Nasdaq Inc (NDAQ) $51.00 -11.81%
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Helmerich & Payne Inc. (HP) $33.65 -3.33%
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Broadcom Inc. (AVGO) $855.36 6.31%
Intel Corp. (INTC) $33.07 5.52%
Adobe Systems Inc. (ADBE) $474.63 4.54%
Seagate Technology Plc (STX) $63.41 4.14%
Illumina Inc. (ILMN) $208.14 3.79%
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Lam Research Corp. (LRCX) $627.53 3.45%
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Micron Technology Inc. (MU) $67.45 3.09%
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Fiserv Inc. (FI) $114.23 -100.00%
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Kraft Heinz Co. (KHC) $36.58 -0.81%
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