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US markets climb higher ahead of FOMC meet

29 Oct 2014 Evaluate

The US markets rallied on Wednesday, ahead of the Federal Reserve’s two-day policy meeting. Federal Reserve officials are widely expected to announce the end to the 2008-era bond-buying stimulus program, while leaving the language on the statement broadly dovish. That generally means the central bank would be quick to signal a prolonged period of low rates, if the economy proves dicey. On the economy front, the consumer confidence in October rose to a reading of 94.5, up from 89 in September. Looking ahead, consumers have regained confidence in the short-term outlook for the economy and labor market, and are more optimistic about their future earnings potential. US home prices nudged up 0.2% in August, slower than the 0.6% rise in July. Among 20 tracked cities, three saw prices fall, while Detroit posted the fastest growth. After seasonal adjustments, home prices among the 20 cities declined 0.1% in August -- the strongest result in fourth months -- compared with a 0.5% decline July. Meanwhile, annual growth slowed down, with year-over-year home prices rising 5.6% in August -- the slowest pace since November 2012 -- compared with annual growth of 6.7% in July.

On the other hand, orders for US durable goods fell 1.3% in September to mark the second straight decline, as demand waned for a variety of products including autos, aircraft, computers and heavy machinery. Stripping out the volatile transportation sector, orders fell by a smaller 0.2%. Orders for core capital goods - a measure of business investment - dropped 1.7% in the biggest decline since January.

Dow Jones Industrial Average added 187.81 points or 1.12 percent to 17,005.75, Nasdaq was up by 78.36 points or 1.75 percent to 4,564.29, while S&P 500 ended higher by 23.42 points or 1.19 percent to 1,985.05. 

The Indian ADRs closed mostly in green on Tuesday; Tata Motors was up 1.75%, ICICI Bank was up 1.08%, HDFC Bank was up by 0.99% and Infosys was up by 0.78%.  On the other hand, Dr. Reddy’s Lab was down by 0.32%.

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