GLOBAL MARKETS-Equities rise after strong US data, yen firms on currency warnings
Global stock markets rose after strong U.S. economic data, with the S&P 500 and STOXX 600 hitting record highs. The yen strengthened against the dollar following Tokyo's intervention warnings. Precious metals like silver, gold, and platinum reached new records. U.S. GDP grew at a 4.3% annualized rate, surpassing expectations. Oil prices increased amid U.S. economic optimism and Venezuelan crude sales. The dollar weakened against major currencies, while U.S. government bond yields showed mixed movements.
(Updates prices after US stock market close)
Wall Street gains with S&P 500 notching record closing high
STOXX stock index hit record close in Europe
Yen gains with traders on alert to intervention risk
Gold, silver, platinum hit records
By Caroline Valetkevitch and Sinéad Carew
NEW YORK/LONDON, Dec 23 (Reuters) - Major stock indexes advanced on Tuesday after stronger-than-expected U.S. economic data, while the yen gained on the dollar after Tokyo signaled its readiness to support the battered currency. The U.S. benchmark S&P 500 notched a record closing high with strength in growth stocks. Earlier, the pan-European STOXX 600 index also registered a record closing high on gains in the healthcare sector, after heavyweight Novo Nordisk secured U.S. approval of its weight-loss pill.
In precious metals, silver, gold and platinum set new records. Data showed the U.S. economy grew faster than expected in the third quarter, driven by robust consumer spending. Early estimates showed gross domestic product increased at a 4.3% annualized rate last quarter, far above economists’ forecast for a rise at a 3.3% pace, according to a Reuters poll.
“We’re still in this period of playing catch-up with economic data and GDP is dated … But it’s showing strength in the economy, and strength that’s above expectations,” said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder in New York.
U.S. economic releases have been delayed by a record federal government shutdown.
On Wall Street, the S&P 500 (.SPX) rose 31.30 points, or 0.46%, to 6,909.79, surpassing its December 11 close for a fresh record. The S&P 500 growth index (.IGX) finished up 0.8%.
The Dow Jones Industrial Average (.DJI) rose 79.73 points, or 0.16%, to 48,442.41, and the Nasdaq Composite (.IXIC) added 133.02 points, or 0.57%, to 23,561.84.
MSCI’s gauge of stocks across the globe (.MIWD00000PUS) gained 4.61 points, or 0.45%, to 1,020.10, which would also be a record close.
Earlier, the pan-European STOXX 600 (.STOXX) index ended up 0.34%.
Novo Nordisk’s (NOVOb.CO) (NVO.N) U.S.-listed shares finished up 7.3% after the U.S. Food and Drug Administration approved its weight-loss pill, giving the Danish drugmaker a competitive edge in the fast-evolving obesity treatment market.
U.S. government bonds were a mixed picture.
The yield on benchmark U.S. 10-year notes (US10YT=RR) fell 0.4 basis points to 4.167%, from 4.171% late on Monday and the 30-year bond (US30YT=RR) yield fell 1.8 basis points to 4.8252%.
But the 2-year note (US2YT=RR) yield, which typically moves in step with interest rate expectations for the Federal Reserve, rose 2.9 basis points to 3.532%, from 3.503% late on Monday. In currencies, the yen gained against the dollar as investors weighed the odds of an imminent intervention after Finance Minister Satsuki Katayama said Japan has a free hand in dealing with excessive moves in the yen, the strongest warning so far about Tokyo’s readiness to intervene in the market to arrest sharp declines in the currency. The BOJ raised rates at its December policy meeting on Friday, as expected.
Against the Japanese yen (JPY=) , the dollar weakened 0.47% to 156.31.
The dollar index (=USD) , which measures the greenback against a basket of currencies including the yen and the euro, fell 0.29% to 97.96. The euro (EUR=) was up 0.25% at $1.1789. In precious metals, silver extended its record rally and blew past the $70 an ounce mark for the first time, while gold and platinum also touched historic highs.
Spot silver (XAG=) was up 3.49% at $71.43 while spot gold (XAU=) rose 1.02% to $4,490.93 an ounce and spot platinum was up about 7% at $2,269.25. In energy markets, oil prices ended Tuesday’s session higher as potential sales of Venezuelan crude seized by the United States weighed and investors assessed stronger-than-expected U.S. economic data.
U.S. crude (CLc1) settled up 0.64%, or 37 cents at $58.38 a barrel, while Brent (LCOc1) settled at $62.38 per barrel, up 0.5%, or 31 cents.
