DOW and S&P 500 ended at record highs yesterday after economic data supported views that the Federal Reserve would keep its stimulus intact for several months and IBM rallied after the company announced a stock buyback.
IBM gave the biggest boost to the Dow, which led the day’s gains. The stock, which also helped drive the S&P 500’s advance, jumped 2.7 per cent to $182.12 after the company’s board of directors approved another $15bn for stock buybacks.
In the latest economic data, a gauge of US consumer spending rose in September, but another report showed consumer confidence fell sharply in October because of worries about the impact of the partial government shutdown.
The data added to evidence of sluggish economic growth just as the Fed began a two-day policy meeting. Expectations are high that officials are unlikely to shift monetary policy this week as they wait for more evidence of how badly Washington’s budget battle has hurt the US economy.
Limiting some of the day's gains in both the Nasdaq and the S&P 500, Apple shares dropped 2.5 per cent to $516.68 a day after the iPad and iPhone maker delivered disappointing results.
The Dow Jones industrial average gained 111.42 points, or 0.72 per cent, to end at 15,680.35, a record close. The Standard & Poor’s 500 Index rose 9.84 points, or 0.56 per cent, to finish at 1,771.95, also a record closing high. The Nasdaq Composite Index rose 12.21 points, or 0.31 per cent, to close at 3,952.34.