Health care com­pa­nies, banks lift stocks slightly

Mar­ket hov­er­ing near its lat­est record highs, set on Wed­nes­day.

Austin American-Statesman - - BUSINESS - Mar­kets

A late wave of buy­ing helped nudge U.S. stock in­dexes slightly higher Fri­day after a day of mostly list­less trad­ing.

Banks and health care stocks climbed the most as in­vestors priced in an in­creas­ing like­li­hood that in­ter­est rates will rise in the com­ing months.

Fed­eral Re­serve Chair Janet Yellen helped stoke those ex­pec­ta­tions in a speech in which she said an im­prov­ing job mar­ket and ris­ing in­fla­tion would likely prompt the cen­tral bank to in­crease bor­row­ing costs.

“The real take­away here is if the Fed is will­ing to start mov­ing, they see the econ­omy as not only do­ing bet­ter but likely to do bet­ter go­ing for­ward,” said Brad McMil­lan, chief in­vest­ment of­fi­cer at Com­mon­wealth Fi­nan­cial Net­work. “The Fed is notorious for wait­ing un­til the ev­i­dence of growth is ab­so­lutely un­de­ni­able.”

The Dow Jones in­dus­trial av­er­age rose 2.74 points, or 0.01 per­cent, to 21,005.71. The Stan­dard & Poor’s 500 index gained 1.20 points, or 0.1 per­cent, to 2,383.12. The Nas­daq com­pos­ite index added 9.53 points, or 0.2 per­cent, to 5,870.75.

Small-com­pany stocks fell. The Rus­sell 2000 index slipped 1.54 points, or 0.1 per­cent, to 1,394.13.

Speak­ing in Chicago on the Fed’s eco­nomic out­look Fri­day, Yellen said the Fed will likely re­sume rais­ing in­ter­est rates later this month to re­flect a strength­en­ing job mar­ket and in­fla­tion edg­ing to­ward the cen­tral bank’s 2 per­cent tar­get rate.

Yellen added that the cen­tral bank ex­pects steady eco­nomic im­prove­ment to jus­tify ad­di­tional rate in­creases. While not spec­i­fy­ing how many rate hikes could oc­cur this year, Yellen noted that Fed of­fi­cials in De­cem­ber had es­ti­mated that there would be three this year.

In­vestors’ ex­pec­ta­tions of a rate hike this month had been build­ing in re­cent days as re­marks by other Fed of­fi­cials sig­naled the cen­tral bank is ready to re­sume rais­ing rates as soon as its next two-day meet­ing of pol­i­cy­mak-

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