[Asia Economy New York=Correspondent Baek Jong-min] The New York stock market managed to rebound despite concerns over the novel coronavirus. Meanwhile, safe-haven assets such as gold and government bonds all declined.
On the 28th (local time) at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average closed at 28,722.85, up 187.05 points (0.66%). The S&P 500 index rose 32.61 points (1.01%) to 3,276.24, and the Nasdaq index increased by 130.37 points (1.43%) to close at 9,269.68. The Chicago Board Options Exchange (CBOE) Volatility Index (VIX), known as the fear gauge, also reflected market relief by dropping 10.7% from the previous trading day to 16.28.
The U.S. stock market had given up most of this year's gains after experiencing its largest drop since October last year the day before, but on this day, it showed an upward trend from the opening, temporarily easing concerns about the novel coronavirus.
By individual stocks, Apple rose 2.8% on expectations of earnings announcements. After the market closed, Apple reported better-than-expected results, pushing its stock price up about 3% in after-hours trading.
As risk assets like stocks rose, safe-haven assets reversed to a decline. U.S. Treasury yields, which had been strong continuously since the spread of the novel coronavirus infection, reversed to rise for the first time in a while. The 10-year U.S. Treasury yield rose 5.6 basis points (0.056 percentage points) to 1.661% compared to the previous day. An increase in bond yields means a price decline. Gold prices also reversed to a decline, with February delivery gold on the previous day falling 0.5% ($7.60) per ounce to $1,569.80.
At the New York Mercantile Exchange (NYMEX), March delivery West Texas Intermediate (WTI) crude oil closed at $53.48 per barrel, up 0.6% ($0.34) from the previous day, marking a rebound after six days.
Economic indicators released that day reflected the favorable state of the U.S. economy. The Conference Board's January Consumer Confidence Index rose from 128.2 in the previous month to 131.6, exceeding market expectations. The U.S. Department of Commerce also reported that durable goods orders in December increased by 2.4% compared to the previous month, significantly surpassing market forecasts. However, this was analyzed to be influenced by a sharp increase in defense-related orders, as durable goods orders excluding defense decreased by 2.5%.
The CoreLogic Case-Shiller National Home Price Index for November rose 0.2% month-over-month. Year-over-year, it increased by 3.5%, showing that the upward trend in housing prices is being maintained.
The market is closely watching the Federal Reserve's Federal Open Market Committee (FOMC) results, which are approaching in one day.
Experts expect the FOMC to likely keep interest rates unchanged this time but anticipate that the Fed will assess the impact of the novel coronavirus on the economy and evaluate the increased assets resulting from its intervention in short-term financial market turmoil last year.
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