The US markets closed higher on Tuesday, on upbeat housing data and ahead of Fed meeting conclusion tomorrow on the hopes that the central bank may announce additional stimulus measures. The Federal Open Market Committee began a two-day session. The US central bank is scheduled to release its statement on interest rates and the economy tomorrow in Washington, the most to be expected would be an extension of the Fed’s ‘Operation Twist’ program, of selling short-term securities while buying longer-term ones, to keep a lid on long-term interest rates. Besides, the Commerce Department stated that US builders started work on new homes in May at a slightly slower pace, but permits for future construction jumped to the highest level in nearly four years. Housing starts fell 4.8% last month to an annual rate of 708,000 - below the 720,000 forecast of economists surveyed.
In Europe, the leader of pro bailout party Antonis Samaras inched closer for forming a coalition government in Greece and Spain completed the sale of €3 billion of bonds auction at record yields. On the other hand, European Union and German government officials have stated that there was no discussion at the Group of 20 meeting about a rumored plan to use bailout backstop funds to purchase government bonds of crisis-hit member states.
The Dow Jones Industrial Average closed higher by 95.51 points or 0.75%, at 12,837.30. The S&P 500 finished the day up by 13.20, or 0.98 percent, to 1,357.98 while the Nasdaq closed higher by 34.43 points or 1.19 percent, to 2,929.76.
Most of the Indian ADRs closed in green; ICICI Bank was up by 0.75%, HDFC Bank was up by 0.53% and Tata Motors was up 0.29%. On the flip side, Infosys was down by 0.27% and Tata Communications was down 0.18%.