The US markets closed higher on Thursday, rallying on some positive economic data, better-than-expected earnings and dovish comments from European Central Bank (ECB) President Mario Draghi. Draghi indicated the central bank could move next month to expand stimulus measures in the face of sluggish global growth that is exacerbating worries about persistently low inflation in the euro zone. The US central bankers will meet on October 27-28 to set monetary policy for the next six weeks. Fed watchers think a rate hike is off the table next week. Investors also were heartened by strong economic data, including an employment report that showed the four-week average of initial jobless claims fell to its lowest level in four decades, suggesting that the jobs market remains solid amid questions about global growth. The four-week average of claims, a less volatile measure than the weekly figure, decreased to 263,250 from 265,250 in the prior week. This is the lowest level for this average since December 1973. Initial unemployment claims in the week ended October 17 rose by 3,000 to 259,000. Claims had fallen by 20,000 in the prior two weeks.
Meanwhile, US home prices rose to a seasonally adjusted 0.6% in July. The National Association of Realtors reported a 4.7% rise in existing-home sales to a seasonally adjusted annual rate of 5.55 million, marking the second-highest monthly level since just before the housing market collapsed in 2007. Separately, the Chicago Fed National Activity Index (CFNAI) remains in negative territory. These are made up of four components and themes: production and income; employment data; personal consumption and housing; and sales, orders and inventories. The CFNAI was shown to have ticked to -0.37 in September from -0.39 in August. Two of the four broad categories of indicators decreased from August.
The Dow Jones Industrial Average added 320.55 points or 1.87 percent to 17,489.16, Nasdaq was up 79.93 points or 1.65 percent 4,920.05, while the S&P 500 gained 33.57 points or 1.66 percent to 2,052.51.
Indian ADRs ended in green, Dr. Reddy’s Lab was up 0.87%, Infosys was up 0.51%, Tata Motors was up 0.32%, Wipro was up by 0.22% and HDFC Bank was up by 0.12%.
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