Blue chip index Dow Jones Industrial Average hit new records

Andrew Cummings
January 20, 2018

The Dow Jones Industrial Average closed marginally lower on Tuesday after the blue-chip index relinquished all its early gains in the sharpest daily reversal in almost two years, according to FactSet. On Wednesday, the Dow closed the session at 26,115.65, up more than one percent. U.S. homebuilding fell more than expected in December, recording its biggest drop in just over a year, while weekly jobless claims dropped to a 45-year low last week.

The latest milestone in the Dow came as optimism over earnings fuelled a rally in USA stocks on Wednesday.

Wall Street's main indexes edged lower on Thursday as declines in healthcare and energy stocks paused a rally that had driven the Dow to its fastest ever 1 000 point gain.

S&P 500 e-minis were up 12.5 points, or 0.45 percent, with 312,460 contracts traded. IBM rose 2.9% after Barclays analysts upgraded the stock two notches to "overweight" and increased its price target by $59 to $192. The nation's largest insurer also hiked its forecast well beyond expectations, largely due to help from the federal tax overhaul.

Industrial stocks rose after the Federal Reserve said US industrial production increased 0.9 percent in December. "If you look at year-to-date performance, you have the broad popular indices up roughly 3 [percent] to nearly 5 percent in two weeks' trading".

Ford Motor slumped 7 percent after the automaker gave a disappointing profit forecast for the year because of weaker sales in the US, higher commodity costs and its investments in new electric and hybrid cars. Its shares added 85 cents to $44.92. The euro fell to $1.2235 from $1.2271.

Goldman Sachs fell 1.9% after posting its first quarterly loss in six years on tax-related charges and a sharp drop in trading revenue.

Even with Tuesday's reversal, the stock market is off to a stellar start in 2018.

US crude added 24 cents to $63.97 per barrel on the New York Mercantile Exchange. It fell 57 cents to $63.73 per barrel on Tuesday.

The dollar rose to 111.13 yen from 110.30 yen on Wednesday. In Asia, Tokyo's Nikkei 225 added 1 percent, while Hong Kong's Hang Seng jumped 1.8 percent. The futures allow investors to make bets on the future price of bitcoin.

In London, FTSE 100 is up around 22 points at 7,723. Seoul's Kospi rose 0.7 percent.

Other reports by iNewsToday