Fed Chairman pledged to keep rates low for a long time

US mkts gain, gets support as dollar pulled back & Fed Chairman pledged to keep rates low for a long time; Indian ADRs ended mostly in green; Sterlite Ind up 2.48%

The US stocks closed higher after a knee jerk reaction in early trade. Markets got support as the dollar pulled back and Fed chairman Ben Bernanke pledged to keep rates low for a long time in his semi-annual testimony before congress. Stocks had slipped in initial trade on disappointing new home sales for January.

The 11.2% drop in home sales was their worst monthly downturn since January 2009. Financials were among the top gainers.

At closing bell, the Dow Jones ended with 0.9% gain, clawing back most of the 100 points it lost in the prior session’s selloff. The S&P 500 & the Nasdaq saw one percent gains.

In a prepared statement for his semi-annual testimony on monetary policy, Fed chairman Bernanke indicated that the FOMC continues to anticipate a moderate pace of economic recovery and that inflation is expected to remain subdued.

Barack Obama, US President said that, “We want everyone in this room to succeed. I want your shareholders to do well, I want your workers to do well, and I want you to do well. Now I also believe this- government has a vital if limited role to play in fostering sustained economic growth and creating the foundations for you to succeed.”

The dollar fell as comments by US Federal Reserve chairman Ben Bernanke dampened speculation that a tightening of monetary policy might be nearing. However, the greenback recovered some losses in late trade yesterday.

Commodities managed to move higher in the face of the dollar’s upturn. That gave the CRB commodity index a 0.9% gain. Oil was especially strong. It climbed 1.3% to USD 79.93 per barrel, despite a larger-than-expected build in weekly crude oil inventories.

Industrial metals lagged the broader commodity index this session. Although copper futures were modestly higher, aluminum and nickel futures slipped over a percent.

Indian ADRs ended mostly in green on Wednesday. In IT space, Infosys was up 1.71% at $ 56.47, Satyam Computers was up 1.18% at $ 5.16, Wipro was up 1.06% at $ 21.01 and Patni Computers was up 0.52% at $ 21.12.

In Banking space, HDFC Bank was up 1.54% at $ 121.47 and ICICI Bank was up 0.72% at $ 36.6. In Telecom space, Tata Communication was down 0.55% at $ 12.55 and MTNL was down 1.27% at $ 3.0805.

In other sectors, Sterlite Industries was up 2.48% at $ 16.53, Dr Reddy’s Labs was up 1.32% at $ 24.55 and Tata Motors was up 0.33% at $ 15.2.

No related posts.