U.S. stocks experienced modest gains on Monday, Nov. 17.
The S&P 500 Index closed 0.07 percent higher at 2041.32, and the Dow Jones Industrial Average also experienced a slight gain, increasing 0.07 percent, according to CNBC.
These major stock indices moved higher as European Central Bank President Mario Draghi said the governing council of the financial institution he heads is still “unanimous in its commitment to using additional unconventional instruments if needed,” the media outlet reported. Markets also responded to news that Japan fell into a recession during the third quarter.
Government data also showed weakness in U.S. economic activity, as the Federal Reserve Bank of New York’s Empire Index of manufacturing and business conditions’s upward movement fell short of expectations, and industrial output declined 0.1 percent in October, according to Bloomberg.
“This global uneven economic activity probably means that central banks are going to stay the course and that remains favorable for the equity markets,” Peter Cardillo, chief market economist at Rockwell Global Capital, told CNBC. Stocks’ “initial slight sell-off was due to the surprise out of Japan, that Japan’s economy contracted. That basically caused the U.S. market to follow global markets.”
Free Reports:
Cardillo said that in making his recent statements, Draghi “is once again reassuring the markets that if more stimulus is needed, they will take unconventional methods,” the media outlet reported.
Chad Morganlander, a money manager at St. Louis-based Stifel Nicolaus & Co., said that risk-taking activity has been bolstered by people’s hopes that a large number of central banks will keep using accommodative policy, according to Bloomberg. Draghi emphasized that for Europe’s economy to truly recover, unified action will be needed. The president of the ECB noted that both institutions and governments in the region will need to act together.
Draghi made these statements after 89 percent of respondents in the latest quarterly Bloomberg Global Poll said that in the next year, euro zone deflation would be a greater concern than inflation. In addition, two-thirds provided their input that the region’s economy was going downhill.
“The euro-zone economy has deteriorated and will get worse if there are no fiscal policy actions from core European countries, mainly Germany,” survey respondent Sanwook Lee, senior portfolio manager at Shinhan Bank in Seoul, wrote in an e-mail, according to the news source.
Brian Dolan, who participated in the poll and works for Chatham, New Jersey-based online investment broker DriveWealth.com as chief market strategist, said the ECB’s policies were not working well, the media outlet reported.
Market participants who want to trade stocks online might benefit from knowing about the slight increase both the Dow and the S&P 500 enjoyed on Monday, Nov. 17. Being familiar with the general economic developments that surrounded this appreciation could also be helpful, enabling them to make better-informed trades.
The post US Stocks Rise Slightly appeared first on | HY Markets Official blog.