Stocks Rise as S&P 500, Nasdaq Top Records Again: Markets Wrap

  • Euro falls as ECB gathers ahead of Thursday’s rate decision
  • Oil gains; dollar steadies after Tuesday slump on healthcare

Three Must-See Charts About This Quarter's Earnings

Stocks surged Wednesday on earnings strength, with the S&P 500 Index and Nasdaq Composite Index hitting records for a second straight day. The euro retraced some recent gains as European policy makers gathered in Frankfurt before Thursday’s decision on interest rates. Oil advanced.

Every S&P 500 sector was higher, with energy stocks and materials companies pacing the rise. Vertex Pharmaceuticals Inc. led gainers, adding more than 20 percent after reporting promising results for its cystic fibrosis treatment. Technology remained hot as well, with the Nasdaq 100 Index also reaching an all-time high. The Dow Jones Industrial Average was up as well, but IBM, which reported disappointing quarterly sales, weighed on the index.

In Europe, it was a day of reversing trends, with the common currency coming off its highest close since August 2015 as investors weighed the European Central Bank’s plans for stimulus measures and the possibility of a change of tone when the decision is announced. The dollar steadied after the implosion of the U.S. health-care reform bill sent it to the lowest since September a day earlier. The Stoxx Europe 600 Index advanced following its largest drop this month. Electrolux AB and ASML Holding NV were among gainers after reporting earnings.

Read more: Euro Rally at Risk Should Draghi Rein in Hawkish Tone

Investors will be closely watching Europe’s central bank -- as well as the Bank of Japan -- this week for clues on the fate of easy monetary policies that have helped stoke growth and spur equity markets to record highs. Amid mixed economic data, anemic inflation numbers and a U.S. administration struggling to implement its agenda, traders may be forgiven for reassessing hawkish expectations.

“President Draghi will certainly have his work cut out in keeping a lid on the euro at this rate,” Michael Hewson, chief market analyst at CMC Markets U.K., wrote in a note. A move to the 1.20 level is “a distinct possibility on a break of 1.1620 and last year’s high,” he said.

Read our Markets Live blog here.

Here are some other key events coming up:

  • The industry-funded American Petroleum Institute was said to report an increase in U.S. crude stockpiles; official data is Wednesday.
  • The Bank of Japan is forecast to stand pat at its meeting Thursday.

And here are the main moves in markets:

Stocks

  • The S&P 500 closed up 0.5 percent, while the Nasdaq Composite and Nasdaq 100 increased 0.6 percent.
  • The Stoxx Europe 600 climbed 0.8 percent, its biggest gain in a week. The U.K.’s FTSE 100 Index added 0.6 percent.
  • The MSCI All-Country World Index rose 0.5 percent to 476.61, the highest on record and its ninth straight day of gains.

Bonds and Currencies

  • The yield on 10-year Treasuries added one basis point to 2.27 percent.
  • Germany’s 10-year yield slid one basis point to 0.54 percent.
  • Britain’s 10-year yield dropped one basis point to 1.191 percent.
  • The Bloomberg Dollar Spot Index rose less than 0.1 percent.
  • The euro declined 0.3 percent to $1.1518, the biggest fall in a week.
  • The British pound retreated 0.2 percent to $1.302.
  • The Japanese yen fell 0.2 percent to 111.82 per dollar.

Commodities

  • Gold dropped 0.1 percent to $1,241.88 an ounce.
  • West Texas Intermediate crude rose 1.5 percent to $47.10 a barrel.
  • Iron ore added 2.7 percent to reach its highest level since May 3.

Asia

  • Australia’s S&P/ASX 200 Index rose 0.8 percent as bank shares climbed. Analysts said new capital requirements looked fairly benign. More on that story here
  • Chinese shares led in Asia, with the Shanghai Composite Index jumping 1.4 percent. Hong Kong’s Hang Seng Index was up 0.6 percent. Japan’s Topix Index swung between gains and losses, while South Korea’s Kospi Index rose 0.2 percent.  

— With assistance by Adam Haigh, Namitha Jagadeesh, Simon Ballard, James Herron, Will Davies, and Cormac Mullen

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