US markets closed up; S&P posts biggest advance in 4 weeks

The US markets closed higher on Tuesday, sending the Dow Jones Industrial Average to an intraday record high, while the S&P 500 recorded its biggest one-day gain in 4 weeks. Investors also grew optimistic about the Fed keeping the interest rates low for a while. The US Federal Reserve meets on Tuesday and Wednesday and investors will parse the central bank’s words closely for any clues on the timing of the first US rate hike in more than eight years. The officials will outline their outlook for the economy in quarterly projections for growth, unemployment, inflation and the benchmark federal funds rate. On the economy front, falling gasoline and food costs kept prices at the US wholesale level unchanged in August, another sign of receding inflationary pressure. The flat reading in the producer price index marks the first time in eight months that that gauge failed to show an increase. Wholesale prices have risen an unadjusted 1.8% in the past 12 months. That’s up from a comparable past-year reading of 1.7% in July but down from a 2 1/2-year high of 2% in May. Personal consumption, an index designed to foreshadow changes in the consumer price index, edged up 0.1% in May.

Dow Jones Industrial Average added 100.83 points or 0.59 percent to 17,131.97, the Nasdaq was up by 33.86 points or 0.75 percent to 4,552.76, and S&P 500 ended higher by 14.85 points or 0.75 percent to 1,998.98.

The Indian ADRs closed mixed on Tuesday; Dr. Reddy’s Lab was up 0.70%, Infosys was up 0.67% and Wipro was up by 0.18%. On the other hand, Tata Motors was down by 0.94% and HDFC Bank was down by 0.37%.