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US markets closed lower on Thursday

20 Nov 2015 Evaluate

The US markets closed lower on Thursday, with weakness in the health-care and energy sectors stunting gains. The lackluster finish for stocks comes on the heels of a market rally on Wednesday that saw the S&P 500 post its largest one-day gain in four weeks following the release of minutes from the October meeting of Federal Reserve policy makers. Federal Reserve Vice Chairman Stanley Fischer stated that US central bankers have done everything to avoid surprising the markets and governments about the first hike in interest rates in nine years. The Fed has taken such pains that many several emerging market and other central bankers for some time have been telling the Fed to just do it. Fischer added that it remains to be seen whether the emerging market countries in Asia and the world are sufficiently prepared for the potential capital flows and market adjustments so that there are no major macroeconomic consequences. Atlanta Fed President Dennis Lockhart stated that the US Federal Reserve may be heading for a slow halting effort to raise interest rates after it begins its first tightening cycle in about a decade. Lockhart added that he is comfortable with moving off zero soon, barring an unexpected downturn in the economic outlook.

On the economy front, the number of people who applied for US unemployment benefits fell by 5,000 to 271,000 in mid-November, offering more evidence the labor market has rebounded after a summer dip. The average of new claims over the past month, meanwhile, rose by 3,000 to a seasonally adjusted 270,750. That’s the highest level in eight weeks but still an extremely low number. The monthly average smooths out sharp fluctuations in the more volatile weekly report and is seen as a more accurate predictor of labor-market trends. Some 2.18 million people collected weekly unemployment checks in the seven days ended November 7. These so-called continuing claims were 2,000 lower compared to the prior week. The Philadelphia Fed manufacturing index showed some improvement, rising to 1.9 in November after being negative for two straight months. New orders and shipments remained negative although they showed some improvement. The Empire State manufacturing index was negative 10.7 for November.

Meanwhile, the leading economic index jumped 0.6% in October after falling in the two prior months, signaling a pickup in growth after a soft patch during the late summer and early fall. A measure of current conditions rose 0.2%. A lagging index also advanced 0.2%. The leading economic index is a weighted gauge of 10 indicators designed to signal peaks and valleys in the business cycle.

The Dow Jones Industrial Average lost 4.41 points or 0.02 percent to 17,732.75, Nasdaq was down 1.56 points or 0.03 percent 5,073.64, while the S&P 500 dropped 2.34 points or 0.11 percent to 2,081.24.  

Indian ADRs ended mostly in green, Wipro was up 0.21%, Infosys was up 0.018%, HDFC Bank was up 0.17% and ICICI Bank was up 0.07%. On the other hand, Dr. Reddy’s Lab was down by 0.94%.


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