The US stock market finished trading in positive territory, but the Dow Jones value remained practically unchanged. Meanwhile, the Nasdaq indicator added more than 1% amid strengthening technology stocks. The US stock market rallied on Monday amid signs of progress in the development of a coronavirus vaccine and increased M&A activity. The Dow Jones added 1.18%, the S&P 500 – 1.27%, the Nasdaq added 1.87%.
The Federal Open Market Committee (FOMC) on Tuesday began its regular meeting, which is the first since the Fed approved a new long-term strategy. The new strategy, approved by the Fed in late August, calls for a change in the central bank's approach to inflation targeting. The Fed will aim to achieve an average inflation rate of 2% “over a period of time.”
In a text released at the end of the July meeting, the Fed announced that it intends to maintain the target range of the federal loan rate at 0-0.25% per annum until it is sure that “the economy has withstood recent events” and is moving towards its goals.
“Investors will be waiting for forecasts of US economic growth and inflation and possible responses from the Fed,” – said the head of Sun Global Investments Mihir Kapadia, quoted by MarketWatch.
Investor optimism on Tuesday was supported by data from the State Statistical Office of the PRC, according to which retail sales in the PRC last month increased by 0.5% compared to the same period last year. The rise in retail sales was recorded for the first time in 2020.
Empire Manufacturing in New York rose to 17 points in September from 3.7 points a month earlier, indicating a steady increase in activity in the state. The value of the indicator significantly exceeded the consensus forecast of 6 points, Trading Economics notes.
At the same time, industrial production in the United States in August 2020 increased by 0.4% compared to the previous month, with a growth forecast of 1%.
The Dow Jones Industrial Average rose 2.27 points (0.01%) to 27,995.6 points.
Standard & Poor's 500 gained 17.66 points (0.52%) and amounted to 3401.2 points.
The Nasdaq Composite rose by 133.67 points (1.21%) – up to 11190.32 points.
Apple Inc. shares (NASDAQ: AAPL) gained 0.16%. The company held its annual online presentation of new products on Tuesday.
Delta Air Lines (NYSE: DAL) Inc. increased by 2.1%. The airline intends to raise funds in the amount of $ 6.5 billion to secure the SkyMiles loyalty program.
Oracle Corp (NYSE: ORCL) quotes. grew by 2.5%. As reported by The Wall Street Journal, China's ByteDance Ltd., owner of TikTok, selected Oracle among US companies seeking to acquire operations of the popular short video sharing service in the United States.
Citigroup Inc (NYSE: C). lost 6.9% in price. A US bank this week will resume its job cuts following the example of its competitors, including Wells Fargo (NYSE: WFC) & Co., reneging on its earlier pledge to take a break during the coronavirus pandemic.
Capitalization Charles Schwab Corp. declined 2.7% after an online broker said it expects revenue to decline slightly in the third quarter compared to the second quarter, while analysts polled by FactSet forecast a 2.3% increase in revenue.