Wall Street ended the week on an up note on Friday as cooling oil prices diminished fears that the economy could be further singed by inflationary pressures and after the US Federal Reserve kept interest rates on hold.
Market action remained volatile through the week, as stocks dived and rallied on alternate days, but finished out the week notably above closing values a week ago.
Investors appeared to largely take in their stride the vast losses announced by mortgage finance giants Freddie Mac and Fannie Mae and announcements by major banks that they would be buying back billions of dollars of tainted securities affected by the credit crunch.
Wall Street booked gains early in the week on Tuesday as the Fed opted to keep its main interest rate pegged at 2 percent as policymakers adopted a wait-and-see approach to lackluster economic growth.
The Dow Jones Industrial Average of 30 blue-chip shares rose 3.6 percent in the week to Friday, to end at 11,734.32, while the broad-market Standard & Poor’s 500 index gained 2.85 percent to 1,296.32.
The technology-laden NASDAQ composite surged 4.46 percent for the week to 2,414.10 as investors prepared for fresh economic reports in the coming week.
“Volatility remained high in both the US equity and fixed income markets last week,” economists at Global Insight said in a briefing note.
“However, a less hawkish statement on policy from the FOMC [Federal Open Market Committee] on Aug. 5, combined with sharply declining energy prices, provided a powerful lift for Dow Jones industrials last week, despite generally weak economic reports,” the Global Insight economists said.
Traders said the markets would be keeping a close eye on oil prices in the coming week and that a government survey on retail sales during July, due for release Wednesday, would also be on Wall Street’s radar.
Bond prices ended the week mixed as the yield on the 10-year Treasury bond rose slightly to 3.950 percent from 3.948 percent a week earlier, while that on the 30-year bond dropped to 4.555 percent from 4.569 percent.
NO-LIMITS PARTNERSHIP: ‘The bottom line’ is that if the US were to have a conflict with China or Russia it would likely open up a second front with the other, a US senator said Beijing and Moscow could cooperate in a conflict over Taiwan, the top US intelligence chief told the US Senate this week. “We see China and Russia, for the first time, exercising together in relation to Taiwan and recognizing that this is a place where China definitely wants Russia to be working with them, and we see no reason why they wouldn’t,” US Director of National Intelligence Avril Haines told a US Senate Committee on Armed Services hearing on Thursday. US Senator Mike Rounds asked Haines about such a potential scenario. He also asked US Defense Intelligence Agency Director Lieutenant General Jeffrey Kruse
INSPIRING: Taiwan has been a model in the Asia-Pacific region with its democratic transition, free and fair elections and open society, the vice president-elect said Taiwan can play a leadership role in the Asia-Pacific region, vice president-elect Hsiao Bi-khim (蕭美琴) told a forum in Taipei yesterday, highlighting the nation’s resilience in the face of geopolitical challenges. “Not only can Taiwan help, but Taiwan can lead ... not only can Taiwan play a leadership role, but Taiwan’s leadership is important to the world,” Hsiao told the annual forum hosted by the Center for Asia-Pacific Resilience and Innovation think tank. Hsiao thanked Taiwan’s international friends for their long-term support, citing the example of US President Joe Biden last month signing into law a bill to provide aid to Taiwan,
China’s intrusive and territorial claims in the Indo-Pacific region are “illegal, coercive, aggressive and deceptive,” new US Indo-Pacific Commander Admiral Samuel Paparo said on Friday, adding that he would continue working with allies and partners to keep the area free and open. Paparo made the remarks at a change-of-command ceremony at Joint Base Pearl Harbor-Hickam in Hawaii, where he took over the command from Admiral John Aquilino. “Our world faces a complex problem set in the troubling actions of the People’s Republic of China [PRC] and its rapid buildup of forces. We must be ready to answer the PRC’s increasingly intrusive and
STATE OF THE NATION: The legislature should invite the president to deliver an address every year, the TPP said, adding that Lai should also have to answer legislators’ questions The Chinese Nationalist Party (KMT) yesterday proposed inviting president-elect William Lai (賴清德) to make a historic first state of the nation address at the legislature following his inauguration on May 20. Lai is expected to face many domestic and international challenges, and should clarify his intended policies with the public’s representatives, KMT caucus secretary-general Hung Meng-kai (洪孟楷) said when making the proposal at a meeting of the legislature’s Procedure Committee. The committee voted to add the item to the agenda for Friday, along with another similar proposal put forward by the Taiwan People’s Party (TPP). The invitation is in line with Article 15-2