Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


While you were sleeping: Wall Street extends rise

While you were sleeping: Wall Street extends rise

Feb 28 (BusinessDesk) – Wall Street rallied for a second day as stronger-than-expected reports on US business spending and the housing market bolstered optimism about the sustainability of the economic recovery.

In afternoon trading in New York, the Dow Jones Industrial Average advanced 0.94 percent, the Standard & Poor's 500 Index added 1.09 percent, while the Nasdaq Composite Index climbed 1.14 percent.

Orders for durable goods excluding transportation equipment posted their biggest gain in a year, suggesting further strength ahead.

"The encouraging tone of this report suggests that the business sector is beginning to feel sufficiently confident about the improving economic outlook to commit to investment activity," Millan Mulraine, a senior economist at TD Securities in New York, told Reuters.

Separately, the National Association of Realtors said its pending home sales index climbed 4.5 percent to 105.9 in January, the highest reading since April 2010, from a downwardly revised 101.3 in December.

Declining inventory is the key to this year's housing market outlook, according to NAR.

"Favourable affordability conditions and job growth have unleashed a pent-up demand," Lawrence Yun, NAR chief economist, said in a statement. "Most areas are drawing down housing inventory, which has shifted the supply/demand balance to sellers in much of the country. It's also why we're experiencing the strongest price growth in more than seven years."

In Europe, the mood was buoyed by indications that confidence in the euro zone rose more than expected in February. An index of executive and consumer sentiment increased to 91.1 from a revised 89.5 in January, according to the European Commission.

Europe's Stoxx 600 Index climbed 0.9 percent from the previous close. The UK’s FTSE 100 rose 0.9 percent, Germany’s DAX Index increased 1 percent, while France’s CAC 40 jumped 1.9 percent. The euro strengthened 0.3 percent against the greenback and 0.1 percent against the yen.

Nerves about the outcome of Italy's elections appeared to have settled, as Italy’s benchmark stock index advanced 1.8 percent, while investors bought 6.5 billion euros of five- and 10-year of new debt auctioned by the country today.

“The auction has cleared with strong demand and better-than-expected yield levels,” Owen Callan, an analyst at Danske Bank in Dublin, told Bloomberg. There is “very strong demand for the 10 year in particular, which is encouraging. It shows that fears of a rapid disintegration of investor sentiment toward Italy may be overstated.”

Meanwhile, PIMCO's Bill Gross warned that gains in debt might be limited.

“Corporate credit and high yield bonds are somewhat exuberantly and irrationally priced,” Gross wrote in a note published on PIMCO's website. “Spreads are tight, corporate profit margins are at record peaks with room to fall, and the economy is still fragile.”

"Still that doesn’t mean you should vacate your portfolio of them."


© Scoop Media

Business Headlines | Sci-Tech Headlines


Land & Water Forum: Fourth Report On Water Management

The Land and Water Forum (LWF) today published its fourth report, outlining 60 new consensus recommendations for how New Zealand should improve its management of fresh water and calling on the Government to urgently adopt all of its recommendations from earlier reports. More>>



Welcome Home: Record High Migration Stokes 41-Year High Population Growth

New Zealand annual net migration hit a new high in October as more people arrived from than departed for Australia for the first time in more than 20 years. More>>


Citizens' Advice Bureau: Report Shows Desperate Housing Situation Throughout NZ

CAB's in-depth analysis of over 2000 client enquiries about emergency accommodation shows vulnerable families, pregnant women and children living in cars and garages, even after seeking assistance from the Ministry of Social Development and Housing New Zealand. More>>


Speaking For The Bees: Greens Call For Neonicotinoid Pesticide Ban

The National Government should ban the use of controversial pesticides called neonicotinoids after evidence has revealed that even at low doses they cause harm to bee populations, the Green Party said today. More>>


Get More From Scoop

Search Scoop  
Powered by Vodafone
NZ independent news