Yellen commentary on US economy drives markets higher
Published 16-MAR-2017 10:34 A.M.
|
1 minute read
Hey! Looks like you have stumbled on the section of our website where we have archived articles from our old business model.
In 2019 the original founding team returned to run Next Investors, we changed our business model to only write about stocks we carefully research and are invested in for the long term.
The below articles were written under our previous business model. We have kept these articles online here for your reference.
Our new mission is to build a high performing ASX micro cap investment portfolio and share our research, analysis and investment strategy with our readers.
Click Here to View Latest Articles
While Fed Chair Janet Yellen’s announcement of an interest rate increase was much anticipated and arguably had been factored into investment decision making in recent weeks, her commentary regarding the US economy and the likelihood of future rate rises was the news investors were looking for.
Confirmation that the economy was performing well in terms of growth, the labour market, consumer confidence and business activity was welcomed, as these are strong lead indicators of future economic health.
Yellen also reaffirmed the Fed’s previous guidance regarding further rate hikes, saying that she only expected two more rate increases this year.
The Dow responded positively, increasing from the previous day’s close of 20,837 points to hit a high of 20,977 points before closing at 20,950 points, an increase of 0.5%.
The NASDAQ put in a strong performance, increasing 0.7% to close at 5900 points.
The other factor that assisted US markets was a recovery in the oil price as it rallied in afternoon trading.
As is normally the case, gold responded positively to the interest rate increase, jumping 1.4% to close at US$1220 per ounce.
European markets closed prior to Yellen’s address, but they also experienced positive gains with the FTSE 100 up nearly 0.2% to 7368 points.
There were similar gains in mainland Europe with the DAX up 0.2% to 12,009 points. The Paris CAC 40 closed at 4985 points, representing an increase of 0.2%.
On the base metals front, copper, lead and zinc all gained ground while nickel remained relatively flat.
The Australian dollar is fetching approximately US$0.77, implying a significant increase from circa US$0.755, in response to US developments.
General Information Only
S3 Consortium Pty Ltd (S3, ‘we’, ‘us’, ‘our’) (CAR No. 433913) is a corporate authorised representative of LeMessurier Securities Pty Ltd (AFSL No. 296877). The information contained in this article is general information and is for informational purposes only. Any advice is general advice only. Any advice contained in this article does not constitute personal advice and S3 has not taken into consideration your personal objectives, financial situation or needs. Please seek your own independent professional advice before making any financial investment decision. Those persons acting upon information contained in this article do so entirely at their own risk.
Conflicts of Interest Notice
S3 and its associated entities may hold investments in companies featured in its articles, including through being paid in the securities of the companies we provide commentary on. We disclose the securities held in relation to a particular company that we provide commentary on. Refer to our Disclosure Policy for information on our self-imposed trading blackouts, hold conditions and de-risking (sell conditions) which seek to mitigate against any potential conflicts of interest.
Publication Notice and Disclaimer
The information contained in this article is current as at the publication date. At the time of publishing, the information contained in this article is based on sources which are available in the public domain that we consider to be reliable, and our own analysis of those sources. The views of the author may not reflect the views of the AFSL holder. Any decision by you to purchase securities in the companies featured in this article should be done so after you have sought your own independent professional advice regarding this information and made your own inquiries as to the validity of any information in this article.
Any forward-looking statements contained in this article are not guarantees or predictions of future performance, and involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, and which may cause actual results or performance of companies featured to differ materially from those expressed in the statements contained in this article. S3 cannot and does not give any assurance that the results or performance expressed or implied by any forward-looking statements contained in this article will actually occur and readers are cautioned not to put undue reliance on forward-looking statements.
This article may include references to our past investing performance. Past performance is not a reliable indicator of our future investing performance.