S&P 500 Quietly Breaks Record High as Markets Drift Up
By market close, the Dow crept 0.09% higher to 16,921.46 and the Nasdaq slipped 0.08% to to 4,359.33. The S&P closed its second consecutive day of record-breaking highs, though up only 0.13% to 1,959.48.
Worries about Iraq continued to dampen general upbeat sentiment most recently brought on by the Federal Reserve's support interest rate guidance on Wednesday and a drop in U.S. jobless claims released earlier in the day.
Schaeffer's Investment Research senior equity strategist Joe Bell believes recent gains have a solid foundation, rather than being based on unsupported confidence. "We generally see these big market tops when you have that overwhelming amount of optimism and euphoria. We continue to see signs that we're not, from a longer-term perspective, seeing that euphoria or over-the-top optimism," he told TheStreet.
Peter Cardillo, chief market economist at Rockwell Global Capital, also believes the bull-market fundamentals remain sound. His short-term intermediate objective is for the S&P 500 to remain at 1,965 even as fears over the situation in Iraq grow, given that leading indices have not departed far from their record highs amid the turmoil.
Remarks from the Federal Open Market Committee infused U.S. markets with renewed vigor on Wednesday. The benchmark index S&P 500 booked a new record high, fueled by the Fed's assurances this recovery still has legs. Federal Reserve Chair Janet Yellen indicated the world's most powerful central bank will keep interest rates low for some time even as it pared its monthly bond buying program by $10 billion to $35 billion.
Initial jobless claims for the week ended June 13, fell 6,000 to 312,000. The Philadelphia Fed's manufacturing index jumped to 17.8 in June from 15.4 in May. It's the highest reading of activity since last September.
The instability in Iraq, however, was offsetting some of the cheerfulness. President Obama said Thursday he would dispatch as many as 300 military advisers to the country to stabilize the volatile political landscape. Addressing reporters, Obama reaffirmed his stance that he would not send soldiers to quash the conflict.
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