[New York Stock Market] FOMC Relief Rally Continues... S&P 500 and Nasdaq Hit Record Highs for 5 Consecutive Days

[Photo by AP Yonhap News]

[Asia Economy Reporter Byunghee Park] The New York stock market continued its overall upward trend, buoyed by relief that the previous day's Federal Reserve (Fed) Federal Open Market Committee (FOMC) results did not deviate from initial expectations and positive indicators such as unemployment claims.

On the 4th at the New York Stock Exchange (NYSE), only the Dow Jones Industrial Average fell slightly, while the S&P 500 and Nasdaq indices extended their streak of record highs for the fifth consecutive trading day.

The Dow Jones closed at 36,124.23, down 33.35 points (0.09%) from the previous trading day. The S&P 500 rose 19.49 points (0.42%) to 4,680.06, and the tech-heavy Nasdaq index gained 128.72 points (0.81%) to close at 15,940.31.

The Fed announced tapering (reduction of asset purchases) as initially expected by the market the day before. However, since the timing of the tapering and the monthly asset reduction size were almost in line with prior market expectations, the New York stock market instead staged a relief rally. Fed Chair Jerome Powell's reassurance that tapering does not necessarily mean an imminent interest rate hike also acted as a positive factor.

Following the conclusion of the FOMC, the weekly unemployment data released that day hit the lowest level since the COVID-19 pandemic, raising expectations for employment improvement.

According to the U.S. Department of Labor, the number of unemployment insurance claims for the week ending October 30 was 269,000, a decrease of 14,000 from the previous week on a seasonally adjusted basis.

This was the lowest level since 256,000 claims recorded on March 14, 2020, during the early stages of the COVID-19 pandemic, and it was below the expert forecast of 275,000 compiled by The Wall Street Journal (WSJ).

The U.S. Department of Labor is scheduled to release the October nonfarm payroll employment data on the 5th.

Preliminary data for U.S. nonfarm labor productivity in the third quarter of this year recorded the lowest level since the second quarter of 1981. The Department of Labor reported that third-quarter productivity fell at an annual rate of 5.0% compared to the previous quarter, reversing the 2.3% increase recorded in the prior month. This figure was lower than the market forecast of a 3.2% decline compiled by the WSJ.

Unit labor costs rose at an annual rate of 8.3% compared to the previous quarter, exceeding the 1.0% increase recorded in the prior month and the Wall Street forecast of a 7.4% rise.

Among individual stocks, casino operator MGM closed down more than 2% after announcing plans to sell the operating rights of the Mirage Casino in Las Vegas.

Qualcomm rose more than 12% after reporting net income and sales that exceeded expectations, driven by a significant increase in smartphone chip sales.

Moderna's stock fell about 18% following news of a downward revision in its COVID-19 vaccine sales outlook.

Nvidia's stock rose more than 12%, gaining attention as a beneficiary of the metaverse and following Wells Fargo's upward revision of its target price.