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* Gap rises on upbeat forecast
* Peloton sinks on safety probe, profit warning
* Economic data inline with consensus
* Indexes up: Dow 0.68%, S&P 0.88%, Nasdaq 1.23%
NEW YORK, Aug 27 (Reuters) – Wall Street advanced on Friday
as U.S. Federal Reserve Chairman Jerome Powell’s remarks at the
Jackson Hole Symposium calmed fears over the tapering timetable
and sent investors into the weekend in a buying mood.
All three major U.S. stock indexes extended their gains
after Powell’s statement was released, and put the S&P 500 and
the Nasdaq on track to notch record closing highs.
All three indexes were set to post weekly gains.
In his prepared remarks, Powell stopped short of providing a
clearer picture regarding the timing of the central bank’s
tapering of asset purchases or hiking interest rates, the key
elements of its dovish monetary policy aimed at helping the
economy recover from the pandemic recession.
“What (Powell) said seemed to be inline with universal
expectations, that he wasnt going to say much,” said Tom
Martin, senior portfolio manager at GLO(BA)LT Investments in
Atlanta. “He did confirm that a taper beginning this year is
definitely on the table.”
Wall Street’s reaction “signifies that the market is okay
with the way the Fed is being very careful regarding the taper,”
Indeed, Powell appeared to strike a more dovish tone than
other Federal Open Market Committee (FOMC) officials, including
St. Louis Fed President James Bullard and Cleveland Fed
President Loretta Mester, who said earlier in the day that they
expect the tapering process to begin soon and wind down next
Economic data released on Friday delivered, in large part,
precisely what economists expected – a pullback in consumer
spending and sentiment due to the COVID-19 Delta variant, and
signs that the current wave of price spikes will not morph into
long term inflation, inline with Fed assurances.
The Dow Jones Industrial Average rose 240.18 points,
or 0.68%, to 35,453.3, the S&P 500 gained 39.15 points,
or 0.88%, to 4,509.15 and the Nasdaq Composite added
184.01 points, or 1.23%, to 15,129.81.
Nine of the 11 major sectors of the S&P 500 were green, with
energy shares enjoying the largest percentage gain.
Apparel retailer Gap Inc advanced 1.9% following its
full-year net sales forecast hike.
Chipmaker Nvidia‘s shares rose 2.4% after sources
said it would likely seek antitrust approval from the European
Union to take over British chip designer Arm.
Workday Inc jumped 10.2% as brokerages upped their
price targets for the stock after the company beat
second-quarter revenue estimates.
Stay-at-home darling Peloton Interactive Inc slid
6.7% following its profit warning and its announcement was being
probed by U.S. regulators over an accident involving the safety
of its treadmills.
Beijing continued its crackdown on its tech companies,
threatening to curb their ability to list on U.S. exchanges.
U.S.-listed shares of Alibaba Group and Tencent
Music Entertainment fell 3.9% and 1.1%, respectively,
while the Invesco Golden Dragon ETF dropped 1.4%.
The S&P 500 posted 59 new 52-week highs and one new low; the
Nasdaq Composite recorded 111 new highs and 30 new lows.
(Reporting by Stephen Culp;
Additional reporting by Devik Jain in Bengaluru
Editing by Marguerita Choy)