Global equities set new highs; dollar weakens on retail data

S&P 500 breach 2,500 mark

NEW YORK, Sept 16, (RTRS): A gauge of global equities rose and shares on Wall Street set new highs on Friday as investors shrugged off the latest missile test by North Korea, while the dollar eased on unexpected weak economic data that dimmed the likelihood for a US rate hike.

New closing highs were set by the Dow and the S&P 500, which closed above the 2,500-mark for the first time. The Nasdaq set an intraday record on a jump in technology shares.

MSCI’s gauge of stocks across the globe gained 0.11 percent to set a new high for an index that tracks the performance of more than 2,400 stocks in 47 countries. Japan’s Nikkei closed 0.5 percent higher and a more than 3 percent jump for the week was its weekly performance since November

The pan-European FTSEurofirst 300 index of leading regional shares lost 0.41 percent to close at 1,495.38.

The dollar index fell 0.39 percent, while the euro rose 0.33 percent to $1.1957. The Japanese yen weakened 0.56 percent against the greenback at 110.86 per dollar and sterling traded at $1.3591, up 1.46 percent on the day.

US

Wall Street reached record highs on Friday, with the S&P 500 surpassing 2,500 points as telecommunications shares rose and technology bounced back after two days of declines.

The S&P 500’s breach of the 2,500mark came less than four months after it closed above 2,400, and brought 2017’s gain to nearly 12 percent.

Professional investors frequently say they see little special significance in the S&P 500 and Dow Jones Industrial Average hitting round-numbers in the hundreds and thousands. But such milestones do affect the sentiment of investors on Main Street, said Phil Blancato, head of Ladenburg Thalmann Asset Management in New York. The S&P 500 information technology sector rose 0.30 percent, powered by an Nvidia-led surge in chipmakers, while Apple rose 1.01 percent in its first gain since unveiling new iPhones on Tuesday.

The semiconductor index surged 1.71 percent, boosted by Nvidia’s 6.32-percent jump to a record high after Evercore ISI raised its price target on the stock.

AT&T rose 2.15 percent and Verizon Communications added 1.44 percent. Along with T-Mobile, they are offering deals for the newest iPhones that are less generous than in the past.

The Dow Jones Industrial Average rose 0.29 percent to end at 22,268.34 points, while the S&P 500 gained 0.18 percent to 2,500.23, records for both. The Nasdaq Composite added 0.3 percent to 6,448.47. Advancing issues out- numbered declining ones on the NYSE by a 1.76-to-1 ratio; on Nasdaq, a 1.47to-1 ratio favored advancers.

The S&P 500 is trading near 17.6 times expected earnings, down from 17.9 at the end of July but still much higher than its 10-year average of 14.3, according to Thomson Reuters Datastream. Boeing rose 1.53 percent to a record high after Canaccord Genuity raised its price target for the stock.

Among the laggards was Oracle, which sank 7.67 percent, its worst day in more than four years after disappointing forecasts for its profit and cloud business.

About 8.5 billion shares changed hands on US exchanges, above the 20day average of 5.9 billion shares.

Europe

European shares dipped on Friday as another North Korean missile launch softened appetite for riskier banks and miners but still scored their strongest week since July as attractive valuations tempted investors. The pan-European STOXX 600 and eurozone stocks both fell 0.3 percent, while export oriented FTSE slumped 1.1 percent as the pound spiked higher after a Bank of England policymaker opened the door for a possible rate increase in the coming months.

Banks fell 0.9 percent after five straight days of gains, showing strain as investors shed the most risky assets, buying defensive sectors such as utilities, up 0.1 percent.

But European stocks posted their strongest week in two months, having hit a five-week high on Thursday as they recovered from a summer dip. Investors and analysts said attractive valuations capped losses for the region’s equities.

Pharma company Grifols dropped 3.3 percent as Kepler Cheuvreux analysts said a recovery in margins could take longer than expected, removing the stock from their Iberian top picks.

Goldman Sachs strategists downgraded the sector to neutral last week citing its sensitivity to US policies.

Asia

Seoul, Tokyo and Hong Kong stocks ended higher on Friday as traders brushed off initial concerns over North Korea’s latest missile launch while most other Asian markets managed to pare their losses. Seoul bounced back to end 0.4 percent higher while the Korean won also made a U-turn to sit 0.1 percent up.

Tokyo maintained its gains through the day, rising 0.5 percent as the yen weakened against the dollar on a strong US inflation report.