NEW YORK, July 25, 2019 (BSS/AFP) – The S&P 500 and Nasdaq surged
Wednesday to fresh records in New York, while the euro continued to fall
ahead of European Central Bank meeting that is expected to be dovish.
Wall Street faced some significant headwinds that included an announced
regulatory crackdown on technology giants and congressional testimony from
Special Counsel Robert Mueller on election interference by Russia.
But investors, mindful of increasingly dovish statements by central banks,
largely shrugged off any worries.
“It’s a sign of a market that just keeps finding reasons to go up because
you have the support of lower interest rates,” Briefing.com analyst Patrick
O’Hare said.
O’Hare said the big gains by companies after good earnings reflected
underlying confidence bordering on complacency.
The Nasdaq’s record was particularly striking after the Justice Department
announced it would begin an antitrust review of major online platforms to
determine if they have “stifled” innovation or reduced competition.
The move means more scrutiny for tech giants Apple, Amazon, Facebook and
Google-parent Alphabet.
However, none of the companies fell significantly and Facebook finished
with a gain of 1.1 percent despite also being hit with a $5 billion fine over
privacy violations in a wide-ranging settlement that revamps oversight at the
social network.
Art Hogan, chief market strategist at National Securities, said investors
were taking a wait-and-see view of the probe, in part because any action by
the government to break up one or more of the giants would take time.
“These things take years, not weeks,” Hogan said. “It’s going to change
several large companies perhaps, or perhaps not.”
Unlike the other two big US indices, the Dow finished lower, weighed down
by disappointing earnings from Caterpillar and Boeing, which warned it could
further cut production of 737 MAX aircraft or temporarily halt manufacturing
if the jets’ global grounding drags out much longer after two deadly crashes.
– Euro falls, Sterling rises –
On foreign exchange markets, the euro faced more pressure following data
showing a drop in eurozone business growth, with manufacturing especially
weak.
Analysts had believed that the ECB was likely to point Thursday to an
interest rate cut in September but the recent data could even mean a move
this week.
Joe Manimbo, senior market analyst at Western Union Business Solutions,
said weak German factory data also “suggested a heightened urgency for the
ECB on Thursday to deliver a new round of economy-goosing stimulus.”
Meanwhile, the British pound gained ground as Boris Johnson took over as
prime minister.
Investors are keen to see whether Johnson pushes ahead and takes Britain
out of the European Union at the end of October, which he has repeatedly
pledged to do, “no ifs or buts”.
“The pound is beginning to stabilize, proving that a lot of the skepticism
about Boris Johnson’s Brexit policy was already built into the price,” said
City Index analyst Fiona Cincotta.
– Key figures around 2050 GMT –
Pound/dollar: UP at $1.2476 from $1.2440 at 2100 GMT
Euro/pound: DOWN at 89.25 pence from 89.64 pence
Euro/dollar: DOWN at $1.1136 from $1.1152
Dollar/yen: DOWN at 108.21 yen from 108.23 yen
New York – Dow: DOWN 0.3 percent at 27,269.97 (close)
New York – S&P 500: UP 0.5 percent at 3,019.56 (close)
New York – Nasdaq: UP 0.9 percent at 8,321.50 (close)
London – FTSE 100: DOWN 0.7 percent at 7,501.46 points (close)
Paris – CAC 40: DOWN 0.2 percent at 5,605.87 (close)
Frankfurt – DAX 30: UP 0.3 percent at 12,522.89 (close)
EURO STOXX 50: FLAT at 3,532.90 (close)
Tokyo – Nikkei 225: UP 0.4 percent at 21,709.57 (close)
Hong Kong – Hang Seng: UP 0.2 percent at 28,524.04 (close)
Shanghai – Composite: UP 0.8 percent at 2,923.28 (close)
Brent North Sea crude: DOWN 1.0 percent at $63.18 per barrel
West Texas Intermediate: DOWN 1.6 percent at $55.88 per barrel