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US stocks jump despite downbeat data

Wed, Sep 16, 2015, 09:48 AM
New York, Sep 16: The US stocks posted solid gains on Tuesday, as some investors thought that a batch of soft economic reports could give the Federal Reserve an excuse to postpone rate rise on its two-day policy meeting beginning Wednesday.

The Dow Jones Industrial Average surged 228.89 points, or 1.40 percent, to 16,599.85. The S&P 500 added 25.06 points, or 1.28 percent, to 1,978.09. The Nasdaq Composite Index advanced 54.76 points, or 1.14 percent, to 4,860.52, Xinhua news agency reported.

Traders keep a close eye on the Fed's highly-watched key policy meeting on September 16-17, when the US central bank could raise interest rates for the first time in more than nine years.

Some analysts, however, believed that the Fed will not decide to hike rates on the meeting as a string of economic data came out weaker than expected.

The advance estimates of U.S. retail and food services sales for August increased 0.2 percent from the previous month to $447.7 bn, slightly below market consensus of a 0. 3-percent gain, the Commerce Department announced Tuesday.

The US industrial production decreased 0.4 percent in August, exceeding market expectations of a 0.2-percent decline, according to the Federal Reserve on Tuesday.

Meanwhile, the September 2015 Empire State Manufacturing Survey indicates that business activity declined for a second consecutive month for New York manufacturers.

The headline general business conditions index came out at minus 14.7, up slightly from minus 14.92 in August and well below market estimates of minus 0.5.

"Orders and employment weighed on the index. It is the worst back-to-back reading since the beginning of 2009," said Jay Morelock, an economist at FTN Financial, in a note.

The CBOE Volatility Index, often referred to as Wall Street's fear gauge, fell 7.05 percent to end at 22.54 Tuesday.
Agency: IANS
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