S&P 500, Nasdaq end at records despite US shutdown risk

S&P 500, Nasdaq end at records despite US shutdown risk

Channel NewsAsia·2018-01-21 02:05

Traders work on the floor of the New York Stock Exchange. (Photo: REUTERS/Brendan McDermid)

NEW YORK: The S&P 500 and Nasdaq finished at records on Friday (Jan 19) as Wall Street investors shrugged off worries about a US government shutdown amid partisan bickering in Washington.

The broad-based S&P 500 finished up 12.27 points (0.44 per cent) to 2,810.30, while the tech-rich Nasdaq Composite Index gained 40.33 points (0.55 per cent) to 7,336.38.

The Dow Jones Industrial Average also rose, gaining 53.91 points (0.21 per cent) to finish the week at 26,071.72, but that was below the close Wednesday, when all three indices ended at records.

Congressional Democratic leaders met with President Donald Trump at the White House early Friday afternoon to try to avert a shutdown as a midnight deadline loomed for the Republican-controlled Senate to approve a new funding bill.

Stocks pulled back on Thursday as the finger-pointing between Democrats and Republicans intensified over the impasse, but investors appeared to be less perturbed on Friday.

"The market realises it's a short-term thing and we're not going to stay shut down forever," said JJ Kinahan, chief market strategist of TD Ameritrade. "To the market, it's not changing the value of any stocks."

Rather, investors are fixated much more on corporate earnings reports, which have been good so far, Kinahan said. However, he notes the bulk of major companies have yet to report.

In earnings news, IBM fell 4.0 per cent despite posting a year-over-year quarterly revenue increase for the first time in nearly six years. Analysts expressed disappointment that gains in some of IBM's major growth businesses weren't more robust.

American Express, another Dow component, lost 1.8 per cent after announcing it would suspend its share buyback program due to a hefty one-time charge connected to US tax reform that reduced the financial company's capital ratios

Consumer stocks were a strong category, with Procter & Gamble and Colgate-Palmolive both rising about one percent.

Home improvement retailers Home Depot and Lowe's gained 1.5 per cent and 3.5 per cent, respectively.

Nike was the biggest gainer in the Dow, surging nearly five per cent following an upgrade by Wedbush Securities.

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