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Overnight Markets: US stocks advance on Yellen comments

by Himanshu Singh on Apr 17, 2014 at 04:08

Overnight Markets: US stocks advance on Yellen comments

Wall Street advanced for a third straight session on Wednesday as Federal Reserve Chair Janet Yellen reaffirmed the central bank's commitment to keeping interest rates low and Yahoo! Inc. earnings topped estimates.

The Dow Jones industrial average gained 162 points, or 1%, to end at 16,425. The Standard & Poor's 500 Index gained 19 points, or 1.05%, to finish unofficially at 1,862. The Nasdaq Composite Index jumped 52 points, or 1.29%, to close at 4,086.

Economic data showing Chinese economic growth exceeded expectations and US industrial production rose for a second straight month also improved sentiment, though Bank of America (BAC.N) and CSX Corp (CSX.N) sold off following their results.

Yellen reaffirmed the Fed's commitment to keep interest rates low, even after ending its bond-buying programme, as long as inflation remains below target and unemployment elevated. The Fed's Beige Book showed that business activity picked up in most regions in recent weeks.

Yahoo (YHOO.O) was the S&P 500's biggest gainer, rising 6.3%. While the company gave a tepid revenue outlook, revenue growth accelerated in the last quarter of 2013 for Alibaba (IPO-ALIB.N), in which Yahoo holds a 24% stake.

Intel (INTC.O) shares briefly hit their highest since June 2012 a day after the chipmaker posted a quarterly net profit that exceeded Wall Street's estimates. The stock rose 0.6%.

On the negative side, Bank of America Corp (BAC.N) fell 1.6% after the bank swung to a quarterly loss. CSX Corp (CSX.N) fell 1.8% after its results.

After the closing bell, Google Inc (GOOGL.O) reported its quarterly results and its stock tumbled 4.9%. IBM (IBM.N) shares fell 1.5% after the bell following the release of the Dow component's earnings.

The shares of American Express Co (AXP.N) declined 0.9% in extended-hours trading after the world's biggest credit card issuer reported its first-quarter earnings.

In Asia, shares gained on Thursday in morning trade after US industrial production increased more than forecast in March and Yellen said the Fed remains committed to supporting the economic recovery.

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