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Wall Street gets boost from Draghi comments

English.news.cn   2012-10-05 09:24:13            

NEW YORK, Oct. 4 (Xinhua) -- U.S. stocks rallied on Thursday as upbeat comments from the European Central Bank (ECB) President Mario Draghi eased concerns over the eurozone debt crisis. The Standard & Poor's 500 Index advanced for the fourth consecutive day.

When the market closed, the Dow Jones Industrial Average rose 80.75 points, or 0.60 percent, to 13,575.36. The Standard & Poor's 500 Index was up 10.41 points, or 0.72 percent, to 1,461.40. The Nasdaq Composite Index climbed 14.23 points, or 0.45 percent, to 3,149.46.

Market sentiment has been lifted recently as central banks around the globe deployed stimulus measures to improve economic situation and a series of statistics from the United States signaled the world's biggest economy is on the course of recovery.

The ECB decided to keep its benchmark interest rate at the record low level of 0.75 percent on Thursday and also gave an upbeat assessment of the status quo of the eurozone economy, saying the debt-ridden countries had made "significant progress" in restarting their economies and that the European banking system was healthier.

Draghi said the ECB stood ready to buy government bonds "once all the prerequisites are in place."

According to Draghi, the bond-buying plan had "helped to alleviate tensions over the past few weeks" and "now it's really in the hands of governments."

Moreover, the Bank of England also retained its lowest interest rate and bond-buying program to strengthen economy.

Stocks hold gains in afternoon trading after the Federal Reserve's minutes of the latest meeting held on Sept. 12-13 showed that U.S. central bankers were broadly in agreement that additional stimulus was needed to boost the fragile economic recovery.

The Fed policy makers also said they could change the size of the monthly assets purchases to reduce potential risks related to the plan. However, market's response to the minutes seemed to be calm.

On the economic front, applications for jobless benefits rose 4,000 to 367,000 in the week ended Sept. 29, said the Labor Department on Thursday, roughly in line with earlier predictions.

Market sentiment will be put to the test again on Friday, when the government releases its monthly reports on non-farm payrolls and unemployment rate. Now investors are expecting the economy to add 113,000 jobs in September and the unemployment rate to tickle up to 8.2 percent.

In other markets, crude prices rallied sharply on Thursday as conflict between Syria and Turkey added uncertainties to oil supplies in the Middle East.

After dipping to the lowest level in two months on the previous trading day, crude prices rebounded on Thursday as hostilities between Syria and Turkey reinforced supply fears in view that a number of pipelines cross the region.

The U.S. dollar fell against other major currencies on Thursday after Draghi reiterated his support for the euro. In late New York trading, the euro gained to 1.3018 dollars from Wednesday's 1.2899.

Editor: Lu Hui
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