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Overnight Markets: S&P 500 erases loss on Fed minutes
Minutes from the Fed’s last meeting indicated the central bank might be ready for another round of stimulus.
The Standard & Poor’s 500 Index erased earlier losses to close flat on Wednesday as minutes from the Federal Reserve’s last meeting indicated the central bank might be ready for another round of stimulus.
The Dow Jones industrial average dropped 31 points, or 0.23%, to 13,173. The Standard & Poor's 500 Index closed flat at 1,413. The Nasdaq Composite Index gained six points, or 0.21%, to 3,074.
According to the minutes from the 31 July – 1 August meeting, the Fed is likely to deliver another round of monetary stimulus "fairly soon" unless the economy improves considerably.
Markets spend spent most of the session in negative territory after dismal export figures from Japan and caution over Greece's meetings this week with European Union officials gave investors reasons to pull back after the recent rally.
In Japan, exports plunged the most in six months in July as shipments to Europe and China tumbled, adding to concerns about global demand.
In Europe, uncertainty lingered over the effectiveness of Greek Prime Minister Antonis Samaras' attempts to convince other European officials that his country should be given more time to meet targets for deficit cuts. German Chancellor Angela Merkel and French President Francois Hollande meet tomorrow to discuss the fiscal crisis, and both will discuss separately with Samaras later this week.
In the technology sector, Dell Inc was down 5.4% a day after the No. 2 U.S. PC maker warned of a difficult second half and slashed its full-year earnings outlook. Hewlett-Packard Co slipped 1.1% after the close as the world's largest PC maker posted a third-quarter loss. Apple Inc. rose 2%.
On the positive side, homebuilders surged with Toll Brothers Inc shares rising 3.8% after the largest U.S. luxury homebuilder reported a higher quarterly profit and a sharp jump in new orders. DR Horton Inc. added 4.1% and Lennar Corp. rose 3.8%. PulteGroup Inc. jumped 3.9% as a report showed sales of existing homes climbed in July from an eight-month low.
Sunrise Senior Living surged 59.7% after Health Care REIT Inc said it would acquire the company for $14.50 per share. Health Care shares slid 2.7%.
In Asia, equities gained on Thursday on hope central banks in the U.S. and China will ease monetary policy amid signs growth is slowing.
The MSCI Asia Pacific Index gained 0.8% to 122 as of 12:51 p.m. in Tokyo. Hong Kong’s Hang Seng Index rose 0.9%. Australia’s S&P/ASX 200 Index and South Korea’s Kospi Index both added 0.2%. Japan’s Nikkei 225 Stock Average swung between gains and losses as the yen strengthened against the U.S. dollar and the euro. The Shanghai Composite Index lost 0.2%, reversing earlier gains, after a report showed China’s manufacturing may contract at a faster pace in August.
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by Gavin Lumsden on Dec 19, 2014 at 17:24