Wednesday 14th August 2013 |
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Wall Street advanced as comments by a US Federal Reserve official suggested not all policy makers believe September should mark the start of easing the central bank's bond-buying program.
Atlanta Fed President Dennis Lockhart said the US economy has had an "uneven performance" and that he "would argue that recent data do not present a clear picture" about the potential timing to start tapering.
"In my mind, the first adjustments to asset purchases, when they occur, should be the beginning of a process with steps that will be determined as later information arrives and certainty about the direction of the economy accumulates," Lockhart said in a speech in Atlanta. "As I see it, a decision to proceed-whether it is in September, October, or December-ought to be thought of as a cautious first step."
Last week, three other Fed officials recommended next month might already see a cutback in the pace of bond purchases.
Indeed, the latest economic data reflected Lockhart's thinking.
US retail sales rose 0.2 percent in July, increasing for a fourth straight month, but slower than the 0.6 percent increase in June, according to Commerce Department data.
"Although retail sales weren't disappointing, the overall economic numbers still haven't proven themselves period over period for the Fed to act faster," Stephen Carl, head of US Equity Trading at the Williams Capital Group in New York, told Reuters.
In late afternoon trading in New York, the Dow Jones Industrial Average rose 0.27 percent, the Standard & Poor's 500 Index gained 0.35 percent, while the Nasdaq Composite Index added 0.41 percent.
Shares of Apple rose, last up 3.8 percent, after Carl Icahn said in a Tweet that he has a "large position" in the company, adding "we believe the company to be extremely undervalued."
Shares of US Airways plunged, last down 12.1 percent, after the US Justice Department filed an antitrust lawsuit to block its merger with American Airlines parent AMR Corp, saying it would decrease competition and lift prices for consumers.
In Europe, the Stoxx 600 Index increased 0.6 percent. France's CAC 40 lifted 0.5 percent, the UK's FTSE 100 Index advanced 0.6 percent, and Germany's DAX climbed 0.7 percent.
The latest data on investor confidence in Germany, Europe's largest economy, were better than expected. The ZEW Center for European Economic Research said its index of investor and analyst expectations climbed to 42 in August, up from 36.3 in July.
The German data bolsters optimism for tomorrow's release of euro-zone GDP data.
BusinessDesk.co.nz
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