NEW YORK – Wall Street stocks rallied yesterday in a buoyant session propelled by relief at a congressional agreement that removes the near-term risk of a United States debt default.
Democratic and Republican Senate leaders reached an agreement to temporarily lift the debt ceiling through December 3 in a move that buys time for more negotiations in a divided Washington.
“We’ve kicked the can down the road,” said Kim Forrest at Bokeh Capital Partners.
“And, I think the more we kick the can down the road, the less likely the really aggressive kind of measures on taxes and spending are. Wall Street doesn’t like taxes.”
The Dow Jones Industrial Average ended at 34,754.94, up 1%.
The broad-based S&P 500 advanced 0.8% to 4,399.75, while the tech-rich Nasdaq Composite Index gained 1.1% to 14,654.02.
Worries about a default have added to concerns about inflation and tightening monetary policy, prompting volatility in recent weeks.
The Labour Department reported that 326,000 new unemployment claims, seasonally adjusted, were filed last week, 38,000 down from the previous week’s upwardly revised level and fewer than analysts had expected.
The data came ahead of today’s much-anticipated September jobs report that will be scrutinised for its implications for a Federal Reserve plan to soon taper stimulus.
Analysts expect the report to show the US adding 450,000 jobs last month and the unemployment rate dipping slightly to 5.1%.
Many analysts think the Fed will announce that it will start tapering stimulus in the fourth quarter unless the jobs report is a major disappointment.
Among individual companies, Levi Strauss jumped 8.5% as it raised its forecast and announced a US$200 million (RM836.7 million) share repurchase programme. – AFP, October 8, 2021
