by Stephen Culp
NEW YORK (Reuters) – The New York Stock Exchange ended slightly higher on Tuesday as investors reacted to mixed comments from Federal Reserve (Fed) officials on the U.S. central bank’s monetary policy and better data than expected on consumer confidence.
The Dow Jones index gained 0.24%, or 83.51 points, to 35,416.98 points.
The broader S&P-500 gained 4.46 points, or 0.10%, to 4,554.89 points.
The Nasdaq Composite advanced 40.73 points (0.29%) to 14,281.76 points.
After a good start, the three main Wall Street indices fell back during the session, before finally returning to the green.
Noting that the short-term trend in the market was upward, Chuck Carlson, chief executive of Horizon Investment Services in Indiana, said investors would continue to buy stocks “unless there is real news.” negative or unexpected.
“Traders will continue to take profits in uncertain sessions as the end of the year approaches,” he added, while specifying that there was “a long list of reasons why this market could continue to progress.”
Ahead of the Fed’s next monetary policy meeting, on December 12 and 13, market participants are scrutinizing the comments of officials of the American central bank.
While Governor Christopher Waller showed during the day his confidence in the success of the current policy and even mentioned a possible rate cut in the coming months, his counterpart Michelle Bowman suggested that a further increase could be necessary.
The President of the Chicago Fed, Austan Goolsby, hailed the success of measures which made it possible to reduce inflation at a rate not seen in more than seven decades.
These contrasting messages are “rather normal every time the Fed approaches the end of a cycle,” commented Oliver Pursche, vice president of Wealthspire Advisors in New York, while “some Fed officials are more convinced others that it is time to stop” the tightening.
Financial markets expect the Fed to once again keep rates unchanged at its meeting next month.
December also marks an acceleration in holiday shopping, with a survey from the American Retail Federation indicating that consumers planned to spend about 5% more than last year.
This echoes the data on consumer confidence communicated in the morning by the Conference Board, which surprised by its marked improvement.
The US Department of Commerce is also due to publish this week a new estimate of US gross domestic product (GDP) for the third quarter as well as its extensive report on consumer spending.
Eight of the main sectors of the S&P-500 ended the session in the green. The healthcare sector was the worst performer, recording the biggest decline of the day.
On the values side, among the movements of note, Boeing ended the session up 1.4% after RBC Capital Markets revised upwards its recommendation for the aircraft manufacturer.
Micron Technology fell 1.8% after saying it expected quarterly operating costs to be higher than its prior forecast.
( Jean Terzian)
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