By Barbara Kollmeyer and Anora Mahmudova, MarketWatch
NEW YORK (MarketWatch) -- The U.S. stock market rallied on
Friday, sending the S&P 500 and Dow Jones Industrial Average
into record territory, after a surprise fresh stimulus from the
Bank of Japan.
The measures announced by Japan appeared to encourage investors
looking for countries to take steps toward boosting flagging global
growth, just as the Federal Reserve exited its bond-buying
program.
The S&P 500 (SPX) had a new closing high every month since
June 2013 -- but none this October, according to Howard
Silverblatt, senior index analyst at S&P Dow Jones Indices.
If the benchmark index closes at this level, this extraordinary
trend will continue.
The Dow Jones Industrial Average (DJI) also hit an intraday
record, recording a second-straight triple-digit gain. This month
the Dow gained triple-digits nine times. The Nasdaq Composite
(RIXF) rallied and is at the highest level since Feb 2000.
The main benchmarks are set to record hefty weekly gains, and,
surprisingly, end the most turbulent month of the year higher. The
S&P 500 also looks set to put the latest pullback behind it,
fully recovering the losses.
Global stocks were boosted by the Bank of Japan's surprise
increase in its stimulus, with the Nikkei 225 index soaring nearly
5%. The BOJ board voted 5-4 in favor of increasing the central
bank's annual asset purchases to 80 trillion yen, from a prior
target range of Yen60 trillion to Yen70 trillion, amid worries
about dwindling inflation and downbeat economic data.
Investors did not dwell on softer-than-expected economic reports
on consumer spending and labor costs. Consumer spending in the U.S.
fell in September for the first time in eight months, while
employment costs rose for the second straight quarter to mark the
biggest back-to-back gain since 2008.
"The U.S. sends 4.5% of it exports to Japan, and so any action
that can: (a) ward off the threat of deflation and the crippling
effect that has on consumer expenditure; (b) give a boost to the
Japanese economy, which is the world's third largest, has to be
seen as a strong positive for future earnings potential," said
Stephen Pope, managing partner at Spotlight Ideas.
More data at month's end: The final October reading on the
University of Michigan/Thomson Reuters consumer-sentiment index
rose to the highest level since July 2007.
Separately, Chicago PMI rose to a one-year high in October,
helped by gains in new orders, MNI Indicators said Friday.
Stocks to watch: GoPro Inc. (GPRO) surged after results topped Wall Street estimates.
AbbVie Inc. (ABBV) shares rallied after the company said sales
and profit beat analyst forecasts.
Madison Square Garden Co. (MSGNV) shares rose after its fiscal
first quarter revenue far surpassed analyst estimates. The company
is currently considering splitting itself in two.
Starbucks Corp. (SBUX) is down after its first-quarter outlook
fell below forecasts.
Shares of Apple Inc. (AAPL) hit an intraday record in morning
trade and shares gained 34% since the start of the year.
Gold sinks as dollar soars: Gold prices (GCZ4) were trading at
levels not seen since 2010, dropping nearly $34 to $1,164.30, with
the dollar (USDJPY) trading around Yen112.01. Oil (CLZ4) also
pulled back 1.5%. Asian markets were higher, with the Nikkei
closing at its highest level in nearly seven years, on the back of
the Japanese stimulus. European stocks rallied along with global
stocks.
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