NEW YORK, July 12, 2019 (BSS/AFP) – Wall Street stocks set new records
Thursday for a second straight session, with the Dow finishing above 27,000
points — a first — over an expected Federal Reserve interest rate cut later
this month.
The latest new landmark, which was accompanied by a fresh record for the
S&P 500, came as Fed Chair Jerome Powell completed a second day of
congressional testimony at which he emphasized economic risks in remarks that
were widely interpreted as signaling a likely interest rate cut.
The new high drew a cheer from US President Donald Trump, who has
repeatedly criticized Powell on monetary policy. Trump extolled the latest
new peak on Twitter, saying “Dow just hit 27,000 for the first time EVER!”
The Nasdaq, which had closed at a record following Powell’s testimony on
Wednesday, pulled back slightly.
It was joined lower by European bourses, which were pressured by stronger
currencies after Powell’s remarks weighed on the dollar.
“It’s safe to say that investors were pleased with Jerome Powell’s first
day of testimony on Wednesday, with equity markets jumping on his dovish
assessment,” said Oanda analyst Craig Erlam.
“The Fed Chairman doesn’t typically provide strong and direct messages on
policy direction, which makes predicting future rate movements all the more
difficult. But Wednesday’s message was clear, the data is softening —
particularly on the inflation side — and downside risks are significant,”
Erlam said.
– Fresh trade discord –
But Thursday’s records came amid fresh signs of trade policy discord that
have troubled investors over the last year.
Trump, also on Twitter, accused China Beijing of backsliding on a recent
pledge to buy more US farm exports. “Hopefully they will start soon!”
Trump’s latest tweet on China “means we are not closer to a deal with
China,” said Art Hogan, chief market strategist at National Securities.
There were also fresh signs of tension between the US and Europe.
On Wednesday, officials said US President Donald Trump had ordered an
investigation into France’s planned tax on internet services. The French
parliament passed the tax anyway on Thursday, making Google, Apple, Facebook
and Amazon principal targets of the higher taxes.
Among individual companies, Delta Air Lines climbed 1.2 percent as it
reported a nearly 40 percent surge in second-quarter profits to $1.4 billion
on strong flying demand.
The company also benefited from its lack of exposure to the Boeing 737
MAX, which has been grounded following two crashes. Delta does not own any of
planes.
– Key figures around 2130 GMT –
New York – Dow: UP 0.9 percent at 27,088.08 (close)
New York – S&P 500: UP 0.2 percent at 2,999.91 (close)
New York – Nasdaq: DOWN 0.1 percent at 8,196.04 (close)
London – FTSE: DOWN 0.3 percent at 7,509.82 (close)
Paris – CAC 40: DOWN 0.3 percent at 5,551.95 (close)
Frankfurt – DAX 30: DOWN 0.3 percent at 12,332.12 (close)
EURO STOXX 50: DOWN 0.1 at 3,496.73 (close)
Tokyo – Nikkei 225: UP 0.5 percent at 21,643.53 (close)
Hong Kong – Hang Seng: UP 0.8 percent at 28,431.80 (close)
Shanghai – Composite: UP 0.1 percent at 2,917.76 (close)
Euro/dollar: UP at $1.1255 from $1.1251 at 2100 GMT
Pound/dollar: UP at $1.2526 from $1.2502
Dollar/yen: DOWN at 108.45 yen from 108.46 yen
West Texas Intermediate: DOWN 0.4 percent at $60.20 per barrel
Brent North Sea crude: DOWN 0.7 percent at $66.52 per barrel