NEW YORK (AP) — U.S. stocks were hovering near record highs on Tuesday as Chinese shares surged following a wave of monetary easing measures by the People's Bank of China. Supporting the world's second largest economy.
The S&P 500 was up 0.2% in afternoon trading after closing lower the previous day. This year marks the 40th record highThe action was volatile, with the index fluctuating between up and down following an unexpectedly weak report on US consumer confidence released in the morning.
The Dow Jones Industrial Average rose 20 points, or 0.1%, to also hit a record high, while the Nasdaq Composite Index was up 0.6% as of 12:52 p.m. Eastern time.
Financial markets have been generally buoyant since the Federal Reserve raised interest rates. Dramatic changes over the past week The method of setting interest rates has changed. Currently, interest rates are Easing the US economy Interest rates have been kept high for years to quell high inflation.
One risk that still hangs over markets is China's struggling economy and the extent to which its slowing growth will affect the rest of the world. After announcing a number of modest, piecemeal measures so far, the head of the People's Bank of China on Tuesday unveiled a series of wide-ranging reforms to shore up the economy, including cutting the reserve requirements for banks.
Analysts called the coordinated moves encouraging and helped send Chinese stocks soaring, with the Shanghai index up 4.2 percent and Hong Kong's 4.1 percent. But questions remain about how much of a boost it will provide to an economy that has been struggling since Chinese authorities cracked down on excessive borrowing by property developers.
Still, prices for oil and other commodities consumed by China's healthy economy rose. Copper rose 3.1%.
Another risk looming on Wall Street is a slowdown in the U.S. labor market. was greatly alleviated the It peaked in the summer two years ago.The biggest concern among investors is Slowing employment The downturn caused by U.S. companies could get worse.
Interest rate hikes notoriously take a long time to fully permeate the economy, and until last week the Federal Reserve had left its key interest rate at its highest level in 20 years for more than a year before making the unusually large cut in the hopes of providing relief to the job market and economy.
According to a report released Tuesday, the U.S. Households are feeling more anxious Regarding the job market, overall confidence fell in September, rather than rising as much as economists had expected, according to the Conference Board. This is a big problem because U.S. consumer spending is the heart of the U.S. economy.
Shares in AutoZone Inc. fell 1.6% after the auto replacement parts and accessories retailer said a key measure of sales at its U.S. stores barely grew in the latest quarter, part of a disappointing report in which profit and revenue fell short of analysts' expectations.
AutoZone said customers at its U.S. stores continued to postpone non-essential purchases.
Thor Industries, another company that relies on U.S. consumers' demand for non-essential goods, rose 6.4% after a mixed earnings report. The recreational vehicle maker reported its latest quarterly profit and revenue that beat analysts' expectations but also provided an outlook for the next quarter that showed the RV market remaining tough.
“There has been repeated talk of market weakness, but we remain focused on navigating it while improving efficiency,” Chief Executive Officer Bob Martin said.
One of the big winners on Wall Street was Smartsheet, which helps companies manage projects and automate workflows. Shares rose 6.4% after Blackstone and Vista Equity Partners agreed to buy the company in an all-cash deal for $8.4 billion.
In the bond market, Treasury yields were relatively stable after a weaker-than-expected consumer confidence index erased earlier gains. The 10-year yield fell to 3.74% from 3.75% late Monday. The 2-year yield, which better reflects expectations for future Fed action, fell to 3.55% from 3.59% late Monday.
Traders raised their estimates for how much the Fed will cut interest rates when it next meets in November. They now see a 61.6% chance of a half-percentage point cut above normal, up from 53% a day earlier, according to CME Group data.
Overseas stock markets saw stock indexes rise in many European and Asian countries, with France's CAC 40 up 1.3%, South Korea's KOSPI up 1.1% and Japan's Nikkei up 0.6%.
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AP Business Writers Elaine Kurtenbach and Matt Ott contributed.
