The US markets closed higher on Monday; with the S&P 500 and Dow Jones Industrial Average closing at new records, fueled by continued hopes that the Federal Reserve won’t be in a rush to raise interest rates. The fourth straight day of gains was also supported by central bank last week reassurance that it will be patient about the timing and pace of rate hikes. On the economy front, economic growth improved markedly in November, according to the Chicago Fed national activity index. The index rose to 0.73 from an upwardly revised 0.31 in October. The three-month average rose to 0.48 from 0.09 in the prior month. This is the highest three-month average since May 2010. The index, a weighted average of 85 different economic indicators, is designed so that readings above zero indicate above-trend growth. When the three-month average exceeds 0.7, there’s an increasing likelihood of sustained increasing inflation.
However, after hitting their highest level in a year in October, sales of existing homes cooled in November. Sales of existing homes shrank 6.1% in November to a seasonally adjusted annual rate of 4.93 million from 5.25 million in the prior month. This is the weakest sales rate since May.
The Dow Jones Industrial Average added 154.64 points or 0.87 percent to 17,959.44, Nasdaq was up by 16.04 points or 0.34 percent to 4,781.42, while S&P 500 gained 7.89 points or 0.38 percent to 2,078.54.
Indian ADRs closed mostly in green on Monday; Tata Motors was up by 0.66%, HDFC Bank was up 0.44% and Wipro was up 0.15%. On the other hand, Dr. Reddy’s Lab was down by 0.06% and Infosys was down 0.03%.