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Overnight Markets: Yellen’s comments boost Dow and S&P 500

by Himanshu Singh on May 08, 2014 at 04:14

Overnight Markets: Yellen’s comments boost Dow and S&P 500

US stocks mostly gained on Wednesday after comments from Federal Reserve Chair Janet Yellen signaled continued support for the economy, overshadowing a drop in Internet stocks led by Yahoo! Inc. and Groupon Inc.

The Dow Jones industrial average rose 118 points or 0.72%, to close at 16,519. The S&P 500 gained 10 points or 0.56%, to end at 1,878. The Nasdaq Composite dropped 13 points or 0.32%, to finish at 4,068.

Shares declined in early trading but the Dow and the S&P 500 moved into positive territory after Yellen said the US economy was still in need of lots of support, given the "considerable slack" in the labour market in remarks to the congressional Joint Economic Committee.

In the latest snapshot of the US economy, the Labour Department said that US nonfarm productivity fell at its fastest pace in a year in the first quarter because of severe weather.

Financials and utilities were the day's biggest gainers. On the Nasdaq, Yahoo! Inc (YHOO.O) fell 6.6% after Alibaba Group filed for an initial public offering that valued the Chinese e-commerce company well below analysts' consensus estimate.

Google (GOOG.O) shares fell 1%, while Facebook (FB.O) shares slid 2%. Amazon.com Inc (AMZN.O) declined 1.6%.

Groupon Inc (GRPN.O) sank 20.7% as its sales and profit projections for the current quarter trailed some estimates.

Twitter Inc (TWTR.N) lost 3.7% after leading a selloff in Internet shares on Tuesday with an 18% tumble.

Whole Foods Market Inc (WFM.O) also contributed to the Nasdaq's decline as the organic grocer's stock tumbled nearly 19%.

In Asia, shares gained on Thursday after Chinese exports and imports unexpectedly climbed and Yellen said the Fed will continue to support the US economy.

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