Economic Reports Boost Stock Market on Wednesday

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The stock market climbed higher on Wednesday as industrial production increased more than expected during March. 

Wednesday brought some upbeat economic data, which sent the stock market higher.  The three major stock indices, as well as the Russell 2000 Rocket 2 Economic Reports Boost Stock Market on WednesdayIndex, climbed at least one percent on the news.  The Federal Reserve reported that during the month of March, industrial production increased by 0.7 percent, surpassing economists’ expectations of a 0.5 percent increase.  February’s increase was upwardly-revised to 1.2 percent – an amount twice as high as the 0.6 percent increase, which was originally reported.

The Commerce Department’s Census Bureau reported that privately-owned housing starts were at a seasonally-adjusted annual rate (SAAR) of 946,000 during March.  Although the estimate fell short of economists’ expectations of a 965,000 SAAR, it represented a 2.8 percent improvement over February’s 920,000.  February’s reading of 920,000 was upwardly-revised from the initial estimate of 907,000.

The Dow Jones Industrial Average (NYSEARCA:DIA) picked up 162 points to finish Wednesday’s trading session at 16,424 for a 1.00 percent advance.  The S&P 500 (NYSEARCA:SPY) jumped 1.05 percent to 1,862, rising back above its 50-day moving average.

The Nasdaq 100 (NASDAQ:QQQ) soared 1.30 percent to finish at 3,533, although it remained below its 50-day moving average of 3,624.  The Russell 2000 (NYSEARCA:IWM) jumped 1.10 percent to 1,131, while remaining below its 50-day moving average of 1,163.  Solar Powered Charging Station

In other major markets, oil (NYSEARCA:USO) advanced 0.24 percent to close at $37.48.

On London’s ICE Futures Europe Exchange, June futures for Brent crude oil advanced 23 cents (0.21 percent) to $109.59/bbl. (NYSEARCA:BNO).

June gold futures advanced $1.90 (0.15 percent) to $1,302.20 per ounce (NYSEARCA:GLD).

The transportation sector was back making deliveries to the Space Station on Wednesday, as the Dow Jones Transportation Average soared 1.68 percent to close at 7,591 (NYSEARCA:IYT).

In Japan, the exchange rate for the yen continued to be the dominant factor in stock market activity.  Japanese stocks rallied as the yen weakened to 102.25 per dollar during Wednesday’s trading session in Tokyo.  A weaker yen causes Japanese exports to be more-competitively priced in foreign markets (NYSEARCA:FXY).  The Nikkei 225 Stock Average soared 3.01 percent to 14,417 (NYSEARCA:EWJ).

In China, stocks managed to advance, despite the fact that the reading on the nation’s first quarter GDP, which was released by the National Bureau of Statistics on Wednesday, was 7.4 percent – falling short of the 7.5 percent target.  On the other hand, economists had been expecting to see that China’s GDP expanded at an annual rate of 7.3 percent, until Tuesday’s report that credit growth slowed in March to 13.9 percent from February’s 14.2 percent.  The disappointing news motivated many economists to lower their expectations, with estimates that the nation’s GDP may have expanded at an annual rate of only 7.2 percent.  The “less bad” news brought a 0.17 percent advance to the Shanghai Composite Index, which closed at 2,105 (NYSEARCA:FXI).  Hong Kong’s Hang Seng Index rose 0.11 percent to 22,696 (NYSEARCA:EWH).

In Europe, stocks soared despite a report of worsening “disinflation”.  Eurostat reported that during March, the Eurozone inflation rate sank from a dismal, 0.7 percent to an abysmal 0.5 percent.  Because the reading was consistent with the March 31 “flash” estimate, investors obviously were not surprised.  The bad news was counterbalanced by a boatload of better-than-expected, corporate earnings reports.  The Euro STOXX 50 Index jumped 1.54 percent to 3,139 – climbing back above its 50-day moving average of 3,115.  Its Relative Strength Index rose from 43.04 to 50.74 (NYSEARCA:FEZ).

Technical indicators revealed that the S&P 500 climbed back above its 50-day moving average of 1,848 on Wednesday, after jumping 1.05 percent to close at 1,862.  Its Relative Strength Index (RSI) rose from 47.13 to 52.37.  The MACD is climbing toward the zero line, suggesting that the S&P could continue its advance during the immediate future.

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