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Friday 17 March 2017 BUSINESS
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US stock indexes hold steady as Fed-fueled rally fades
STAN CHOE 10-year Treasury yield to
AP Business Writer remain modest, even with
NEW YORK (AP) — Stocks the Fed pledging more in-
held steady on Wall Street creases. Once the yield
Thursday, and bond prices gets to 2.60 percent, he
gave back some of their says many buyers will likely
big gains from the prior pounce given still-modest
day as a rally fueled by growth in the economy
the Federal Reserve’s an- and inflation, which should
nouncement on interest help keep a lid on rates.
rates Wednesday faded. Thursday’s slight rise in
The Standard & Poor’s 500 yields dulled the appeal
index slipped 3.88 points, of dividend-paying stocks.
or 0.2 percent, to 2,381.38. Utility stocks in the S&P 500
The Dow Jones industrial index lost 1.1 percent, the
average fell 15.55 points, or biggest loss among the 11
0.1 percent, to 20,934.55. sectors that make up the
The Nasdaq compos- index. Health care stocks
ite, meanwhile, rose 0.71 were also weaker than the
points, or 0.01 percent, to rest of the index, following
5,900.76. The Russell 2000 a strong start to the year.
index of smaller stocks also Canada Goose CEO & President Dani Reiss rings a ceremonial bell as his company’s IPO begins Technology stocks did bet-
rose slightly, up 3.20 points, trading on the floor of the New York Stock Exchange, Thursday, March 16, 2017. ter, led by Oracle, which
(AP Photo/Richard Drew)
or 0.2 percent, to 1,386.03. reported stronger revenue
Yields ticked higher as plunged 0.11 percentage The Fed is hoping to lift cause they can slow eco- and earnings for its lat-
bond prices fell. The yield points the prior day, after rates gradually off their nomic growth and cor- est quarter than analysts
on the 10-year Treasury the Fed threw cold water record lows, where they porate profits. With rates expected. The tech giant
note rose to 2.53 per- on speculation that it may stayed for seven years fol- starting from such a low jumped $2.68, or 6.2 per-
cent from 2.50 percent get more aggressive in rais- lowing the 2008 financial base and the pace set to cent, to $45.73 for the big-
late Wednesday. It had ing rates. crisis. With both economic be so slow, it may not be gest gain in the S&P 500.
data and inflation picking fair to call these Fed moves GoPro, which makes wear-
up recently, some inves- as “hiking” or “tightening,” able cameras, surged after
tors began to consider the said Rich Taylor, fixed-in- it announced a cost-cut-
possibility that the Fed may come client portfolio man- ting plan and said it’s stick-
try to raise rates four times ager at American Century. ing by its forecast for 2017
this year. But the Fed on “We are in the beginning profits. Its stock rose $1.16,
Wednesday stuck with its stages of a re-normaliza- or 15.8 percent, to $8.51.
forecast for three. tion of interest rates,” Taylor Stock markets across the
That gradual pace is one said. “A 2.5 percent yield Atlantic were also strong,
reason investors remain on a 10-year note is not a with the French CAC 40 up
enthusiastic about stocks normal yield. It’s still a DEF- 0.6 percent and Germa-
in the face of rising rates, CON 4, almost emergency- ny’s DAX also up 0.6 per-
which historically have level rate.” cent. q
spooked stock holders be- Taylor expects gains for the
BOE seems increasingly concerned about inflation
DANICA KIRKA Her unhappiness was evi- The inflation rate now
Associated Press dent in minutes released stands at 1.8 percent, near
LONDON (AP) — The Bank along with the decision. the Bank of England’s tar-
of England kept its interest The document pointed get of around 2 percent.
rates at record-lows Thurs- out that “one member” Higher interest rates can
day to avoid stalling eco- argued that inflation was weigh on inflation — but
nomic growth as Britain rising fast and “likely to re- also on economic growth,
prepares to leave the Euro- main above target for at a fact that presents the
pean Union. least three years.” central bank with a dilem-
But one person on its nine- It was the first non-unani- ma.
strong rate-setting commit- mous vote since last sum- The Bank of England has
tee voted for an increase mer. signaled it is willing to tem-
— a surprise move that Inflation has risen in part porarily ignore the rise in in-
shows concern about the due to the pound’s plunge flation rather than risk reign-
recent surge in inflation. since June, when Britain ing in the economy.
The bank’s Monetary Policy voted to leave the EU. A Analysts said that the vote
Committee voted to keep weaker currency makes failed to tell the whole sto-
its key rate at 0.25 percent, imports more expensive. ry. Policymakers seemed to
a day after the U.S. Federal Higher inflation is likely to be moving closer to Forbes’
Reserve raised its bench- eat into household income view on inflation, particular-
mark rate. The vote was in coming months and ly since their estimates on
8-1, with rate-setter Kristin years, particularly as wages growth for the first quarter
Forbes voting for a rise to are not growing as fast as edged up from 0.5 percent
0.5 percent. before. to 0.6 percent.q
