IBJNews

Stocks open higher day after Federal Reserve move

Back to TopCommentsE-mailPrintBookmark and Share

Stocks opened higher Friday, on track to record one of their best weeks since June, after the Federal Reserve stepped in again to help the disappointing economic recovery.

Just before 11 a.m., the Dow Jones industrial average was up 66 points at 13,606. The Dow rocketed higher by 206 points on Thursday after the Fed announcement and closed at a four-year high.

The Fed pledged to spend $40 billion on mortgage bonds to drive down long-term interest rates and push investors into stocks. It also extended its guarantee of super-low interest rates by six months, into 2015.

The Dow has climbed 2.3 percent this week, its best performance since early June. The last two weeks for the Standard & Poor's 500 index have also been the best since June.

A summer rally has put the Dow within 600 points of its all-time high — 14,164, set on Oct. 9, 2007.

European and Asian stocks spiked Friday in their first trading after the Fed move. French stocks were up 2 percent and German stocks 1 percent. The Nikkei average in Japan climbed almost 2 percent.

In the United States, the S&P was up 12 points at 1,472, and the NASDAQ composite index was up 35 at 3,191.

UnitedHealth Group rose 59 cents, or 1.1 percent, to $54.48 after an announcement that it will be added to the Dow, replacing Kraft Foods. It is the first change in the makeup of the 30-stock average since June 2009.

In the broader market, energy stocks were the best performers and telecommunications companies the worst.

The price of oil rose above $100 for the first time since May before dipping back below. It was up $1.35 for the day at $99.65. Unrest in the Middle East this week has heightened concerns about world oil supply.

Alpha Natural Resources was the best performer in the S&P 500. It rose 63 cents, or 7.7 percent, to $8.86. Valero Energy, Chesapeake and Chevron were among the other winners among energy stocks.

Gold pushed higher for a second day, rising $3 an ounce to $1,775. Gold tends to rise after the Fed announcements like Thursday's, partly because investors fear inflation and partly because a weaker dollar makes gold more expensive.

As investors moved into stocks, they pulled money out of bonds, driving yields up. The yield on the benchmark 10-year U.S. Treasury note climbed 0.16 percentage pont to 1.88 percent, its highest since early May.

The dollar lost ground for a second day against world currencies. The euro climbed a penny and a half to $1.315.

The Commerce Department reported that retail sales increased in August by a seasonally adjusted 0.9 percent, mostly because of higher gasoline prices. Outside of gas and cars, sales rose only 0.1 percent, weaker than in July.

And the cost of fuel drove up consumer prices in August by the most in three years, according to the Labor Department. Without higher energy costs, inflation was static.

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
 
Subscribe to IBJ
  1. In reality, Lilly is maintaining profit by cutting costs such as Indiana/US citizen IT workers by a significant amount with their Tata Indian consulting connection, increasing Indian H1B's at Lillys Indiana locations significantly and offshoring to India high paying Indiana jobs to cut costs and increase profit at the expense of U.S. workers.

  2. I think perhaps there is legal precedence here in that the laws were intended for family farms, not pig processing plants on a huge scale. There has to be a way to squash this judges judgment and overrule her dumb judgement. Perhaps she should be required to live in one of those neighbors houses for a month next to the farm to see how she likes it. She is there to protect the people, not the corporations.

  3. http://www.omafra.gov.on.ca/english/engineer/facts/03-111.htm Corporate farms are not farms, they are indeed factories on a huge scale. The amount of waste and unhealthy smells are environmentally unsafe. If they want to do this, they should be forced to buy a boundary around their farm at a premium price to the homeowners and landowners that have to eat, sleep, and live in a cesspool of pig smells. Imagine living in a house that smells like a restroom all the time. Does the state really believe they should take the side of these corporate farms and not protect Indiana citizens. Perhaps justifiable they should force all the management of the farms to live on the farm itself and not live probably far away from there. Would be interesting to investigate the housing locations of those working at and managing the corporate farms.

  4. downtown in the same area as O'malia's. 350 E New York. Not sure that another one could survive. I agree a Target is needed d'town. Downtown Philly even had a 3 story Kmart for its downtown residents.

  5. Indy-area residents... most of you have no idea how AMAZING Aurelio's is. South of Chicago was a cool pizza place... but it pales in comparison to the heavenly thin crust Aurelio's pizza. Their deep dish is pretty good too. My waistline is expanding just thinking about this!

ADVERTISEMENT