DJIA and S&P 500 extend gains for the second straight session ahead of FOMC
|- Telecom and financial sectors led the gains on Tuesday.
- PPI data beat the market expectations.
- Nasdaq failed to gain traction as tech shares underperformed.
Major equity indexes in the United States started the day on a positive after the upbeat PPI data certified the increasing economic activity and extended their gains ahead of tomorrow's crucial FOMC meeting.
Sharing his remarks on today's data, “from an economic perspective, we did see things like PPI come in today a little bit stronger than anticipated, which supports the path of the Fed. We’re in a synchronized global uptick in activity, and it’s certainly evidenced here in the U.S. rates moving a little bit higher,” Bill Northey, senior vice president, U.S. Bank Wealth Management, in Helena, Montana, told Reuters.
The Fed is widely expected to announce a 25 bps rate hike tomorrow and the rate-sensitive S&P 500 Financials Sector gained more than 1% on the day. The S&P 500 Telecom Services Sector (SPLRCL) became the best performing sub-index of the day as it added 2.75%.
On the other hand, losses seen in tech-giants Facebook and Apple weighed on the technology sector, dragging the S&P 500 Information Technology Sector 0.25% lower. Meanwhile, news of the Forties pipeline, one of Europe’s biggest brent oil transferring systems, being shut down due to cracks triggered a profit taking and weighed on crude oil prices. The barrel of WTI closed the day 1.3% lower and the S&P 500 Energy Sector (SPNY) lost 0.3%.
Based on the latest available data on Reuters, the Dow Jones Industrial Average added 119.39 points, or 0.49%, to 24,505.42, the S&P 500 rose 4.18 points, or 0.16%, to 2,664.17 and the tech-heavy Nasdaq Composite dropped 12.76 points, or 0.19%, to 6,862.32.
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