Closing Update: Stocks Higher For Fourth Straight Day On Strong Data, Dovish Fed

Stocks closed higher for the fourth consecutive day as market-friendly economic data coupled with the expectation for the Federal Reserve to soothe nervous investors at the central bank conference in Jackson Hole drove the S&P 500 to another record high and the Dow Jones Industrial back over 17,000.

Financial stocks put in a strong performance led by Bank of America ( BAC ) whose shares were more than 4% higher despite agreeing to a record $17 billion penalty with the Department of Justice as a result of its misrepresentation of mortgage-backed securities. Although tech stocks had another good day, the Nasdaq Composite lagged its blue-chip counterpart due to weakness in biotech and semiconductor stocks.

The economic data was bullish across the board starting with a greater-than-expected decline in weekly jobless claims of 14,000 to 298,000 versus the consensus for a 12,000 drop.

Manufacturing continued to improve as the PMI flash index for August jumped to 58.0, beating estimates for a small retraction to 55.7. This was followed by a 4.1 gain in the Philly Fed index to 28.0, better than estimates for a decline to 20.0.

The headline, however, was existing home sales which improved 2.4% in July to a seasonally adjusted annual rate of 5.15 million, topping street estimates for a decline to 5.00 million. The strength in the housing market continued to underpin housing and building-related stocks with shares of Home Depot ( HD ) and Lowe's ( LOW ) both hitting record highs.

But despite the implications from upbeat economic data, Wall Street remained bullish given Fed Chair Yellen's consensus for interest rate accommodation to account for slack in the job market. Investors are positioned accordingly for dovish comments from Yellen at her speech in Jackson Hole on Friday.

Here's where the markets stand at the close:


Dow Jones Industrial Index was up 60 points (+0.4%) at 17,039

S&P 500 was up 5.8 points (+0.3%) at 1,992

Nasdaq Composite Index was up 5.6 points (+0.1%) at 4,532


FTSE 100 was up 0.33%

Nikkei 225 was up 0.85%

Hang Seng Index was down 0.66%

Shanghai China Composite Index was down 0.44%


(+) EVRY Agrees to sell UK business

(+) CBDE Awarded $1.7mln in new contracts

(+) EBAY Reportedly plans to spin-off PayPal

(+) HRL Reports better than expected Q3 results


(-) AMPE Osteoarthritis drug mishandled by supplier during recent trial

(-) KIN Study of CereKin (KB010) did not meet primary endpoint

(-) SHLD Reports wider Q2 loss, drop in revenue

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Copyright (C) 2016 All rights reserved. Unauthorized reproduction is strictly prohibited.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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