A dovish turn by the US Federal Reserve cooled the greenback and helped propel US stocks this week, with the NASDAQ scoring especially impressive gains.
The tech-rich index surged 154.66 points (3.17 percent) on the week to 5,026.42, finishing only about 22 points below its record struck in the year 2000.
The Dow Jones Industrial Average jumped 378.34 (2.13 percent) to 18,127.65, while the broad-based S&P 500 advanced 54.66 (2.66 percent) to 2,108.06. The week was dominated by Wednesday’s Fed policy statement, which had been anticipated for clues on when the US central bank intended to hike interest rates.
The Fed dropped a pledge to remain “patient” on raising interest rates, signaling a midyear federal funds rate hike remained possible after keeping the key rate at the zero level for more than six years.
However, other language in the Fed’s statement emphasized that the central bank was in no rush to hike the ultra-low rates, which have supported the stock market. The Fed also broadly lowered its outlook on the US economy this year.
“There were people on the sidelines waiting” for the Fed meeting, Ventura Wealth Management portfolio strategist Tom Cahill said.
“They were forced back into the market,” he said.
US stocks surged on Wednesday and — after a partial pullback on Thursday — again on Friday. Part of the good cheer was from a retreat in the US dollar, which had surged near parity with the euro earlier in the week.
“The market is cheering the news that the Fed rate increase will happen later in the year than previously thought,” Kenjol Capital Management portfolio manager David Levy said.
However, Levy said volatility could pick up again in the coming weeks due to lingering concerns about the strong dollar and weak oil prices, among other issues.
The NASDAQ’s outperformance was spurred in part by positive news-flow from Apple, the world’s biggest publicly traded company by market value.
Apple got a lift from reports that it is in talks with CBS, ABC and other networks to offer a slate of television broadcasts across its devices.
The other big winner this week was Biogen, which sparked a rally in the biotech sector when it reported promising clinical results for its aducanumab drug to treat Alzheimer’s disease.
In other corporate news, Valeant Pharmaceuticals International sealed its deal to take over Salix Pharmaceuticals after raising its bid by 10 percent US$173 per share or US$15.8 billion in cash. Following the sweetened Valeant bid, Endo International withdrew a competing offer.
On Friday, US mall giant Simon Property Group raised its bid for Macerich Co by 5 percent to US$16.8 billion. Macerich had rejected the earlier bid.
US coffee giant Starbucks hit a 52-week high after announcing a stock split, even as the company ran into criticism from some on social media over its “Race Together” initiative, which encourages baristas to engage customers in a discussion of race.
Next week’s calendar includes existing home sales, new home sales and durable goods orders for last month.
Intel Corp chief executive officer Lip-Bu Tan (陳立武) is expected to meet with Taiwanese suppliers next month in conjunction with the opening of the Computex Taipei trade show, supply chain sources said on Monday. The visit, the first for Tan to Taiwan since assuming his new post last month, would be aimed at enhancing Intel’s ties with suppliers in Taiwan as he attempts to help turn around the struggling US chipmaker, the sources said. Tan is to hold a banquet to celebrate Intel’s 40-year presence in Taiwan before Computex opens on May 20 and invite dozens of Taiwanese suppliers to exchange views
Application-specific integrated circuit designer Faraday Technology Corp (智原) yesterday said that although revenue this quarter would decline 30 percent from last quarter, it retained its full-year forecast of revenue growth of 100 percent. The company attributed the quarterly drop to a slowdown in customers’ production of chips using Faraday’s advanced packaging technology. The company is still confident about its revenue growth this year, given its strong “design-win” — or the projects it won to help customers design their chips, Faraday president Steve Wang (王國雍) told an online earnings conference. “The design-win this year is better than we expected. We believe we will win
Chizuko Kimura has become the first female sushi chef in the world to win a Michelin star, fulfilling a promise she made to her dying husband to continue his legacy. The 54-year-old Japanese chef regained the Michelin star her late husband, Shunei Kimura, won three years ago for their Sushi Shunei restaurant in Paris. For Shunei Kimura, the star was a dream come true. However, the joy was short-lived. He died from cancer just three months later in June 2022. He was 65. The following year, the restaurant in the heart of Montmartre lost its star rating. Chizuko Kimura insisted that the new star is still down
While China’s leaders use their economic and political might to fight US President Donald Trump’s trade war “to the end,” its army of social media soldiers are embarking on a more humorous campaign online. Trump’s tariff blitz has seen Washington and Beijing impose eye-watering duties on imports from the other, fanning a standoff between the economic superpowers that has sparked global recession fears and sent markets into a tailspin. Trump says his policy is a response to years of being “ripped off” by other countries and aims to bring manufacturing to the US, forcing companies to employ US workers. However, China’s online warriors
RSS