By Barbara Kollmeyer and Anora Mahmudova, MarketWatch
NEW YORK (MarketWatch) -- The U.S. stock market surged in
morning trade, sending the S&P 500 and Dow Jones Industrial
Average into record territory, as fresh stimulus from the Bank of
Japan.
The measures announced by Japan appeared to encourage investors
looking for country's 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. 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: There's a batch of data on Friday as
the trading month ends. Consumer sentiment for October is due at
9:55 a.m. Eastern Time, with economists expecting that data to
remain unchanged at 86.4 and remain near a 2014 high. Just ahead of
that data, the Chicago purchasing managers index for October will
be released.
Stocks to watch: Exxon Mobil Corp. (XOM) stock rose 2% after the
company reported third-quarter earnings.
Chevron Corp. (CVX) Chevron's stock CVX, +0.05% rose 1.8% in
premarket trade Friday, after the oil giant reported a
third-quarter profit that rose well above expectations, offsetting
a bigger-than-expected decline in sales.
AbbVie Inc. (ABBV) said sales and profit beat analyst forecasts.
The stock soared 4.2%.
Madison Square Garden Co. (MSGNV) said fiscal first quarter
revenue far surpassed analyst estimates. The company is currently
considering splitting itself in two. Shares rose 3.2%.
Hilton Worldwide Holdings (HLT) lifted its full-year outlook
Friday as it reported third-quarter earnings of 19 cents a
share.
Starbucks Corp. (SBUX) is down over 3% after its first-quarter
outlook fell below forecasts. GoPro Inc. (GPRO) is up 17% in
premarket after results topped Wall Street estimates, while
LinkedIn Corp. (LNKD) was up 5% after the company's sales outlook
was a bit weaker than expected, but results also came in slightly
better than forecast.
As markets surged in pre-open, shares of Apple Inc. (AAPL) rose
1.1% in premarket, on course to open at a record intraday high.
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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