US stocks close higher
New York: US stocks closed higher as weak economic data increased investors’ expectations on further rate cuts.
The Dow Jones Industrial Average was up 122.42 points, or 0.47 per cent, to 26,201.04 on Thursday. The S&P 500 rose 23.02 points, or 0.80 per cent, to 2,910.63. The Nasdaq Composite Index went up 87.02 points, or 1.12 per cent, to 7,872.27, Xinhua reported.
Market expectations for a rate cut in October jumped to 90.3 percent from 77 per cent on Wednesday.
Analysts said increasing expectations for rate cuts came after weak economic data.
The Institute for Supply Management (ISM) said Thursday its reading on the US services sector fell last month to its lowest level since August 2016.
The non-manufacturing index registered 52.6 per cent, 3.8 percentage points below the August reading of 56.4 per cent, according to ISM’s report. The figure was also lower than the estimated reading of 55.3 from economists surveyed by Dow Jones.
Respondents are mostly concerned about tariffs, labor resources and the direction of the economy, according to ISM.
Washington said Wednesday that it plans to impose tariffs on a wide range of goods from the European Union (EU) after the World Trade Organization (WTO) gave it permission to levy tariffs on USD 7.5 billion of EU exports to counteract subsidies to Airbus.