US stocks map was all green yesterday with the S&P 500 offset last week decline. Investors still wait for more clarity on the subject of reducing bond purchasing program. It is expected from Fed’s Chairman, Ben Bernanke, to make a statement concerning the stimulus case.
The S&P 500 gained 0.8% after being up 1.2% in the morning trade, Dow Jones Industrial Average added 0.7%. Investors have been analyzing every piece of data lately, due to Bernanke statement last month that Fed would implement stimulus easing only if stable positive data trend is established in US economy.
“Although things are improving, we have a long way to go,” James Dunigan, who is a chief investment officer in Philadelphia for PNC Wealth Management, said by telephone for Bloomberg. “We’re ahead of ourselves with regard to the Fed acting anytime soon in reducing the support that it’s providing for the economy.”, Dunigan added.
Data yesterday showed manufacturers in the New York region felt more optimistic in June, indicating the factories are growing by a sustainable rate. More data showed confidence among U.S. homebuilders climbed last month to the highest level in seven years.
The Fed are giving mixed signals to investors due to their intent not to lose the momentum the US economy has been on for couple of years. The government is clearly signaling that a possible bond buying reduction would mean strong economy and a weak economy leads to more stimulus. It’s a win-win situation which aims to gain investors on their side.
In corporate news, Netflix was the biggest gainer in S&P 500 index recording a share price raise of 7.1%. The subscription service agreed earlier to a deal with DreamWorks. Boeing added 1.2%. The aircraft manufacturer agreed to sell 10 of its 787 Dreamliners to General Electric Co.’s GE Capital Aviation Services leasing division.
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