World stock markets rose to near five-year highs yesterday, boosted by news that China was moving to support its cooling economy, while the dollar fell to one-month lows.
Major US equity indices were flat to slightly lower after a mixed batch of earnings, including chemical maker DuPont and insurer Travelers.
The Standard & Poor’s 500 index, which on Monday posted a record closing high for a third straight session, came within two points of its milestone of 1,700 before turning lower.
The MSCI world equity index, which tracks stocks in 45 countries, climbed 0.14 per cent to 376.08, within about 6 points of the five-year high set in May.
In midday trading, the Dow Jones industrial average was up 15.66 points, or 0.10 per cent, at 15,561.21. The Standard & Poor’s 500 Index was down 2.27 points, or 0.13 per cent, at 1,693.26. The Nasdaq Composite Index was down 12.64 points, or 0.35 per cent, at 3,587.74.
Wall Street has moved higher in 11 of the past 12 sessions. The S&P 500 is up about 20 per cent for the year.
But US shares will likely struggle to extend their winning streak unless there are more upbeat earnings and economic developments, analysts said. “Valuations are decent, there’s positive monetary pressure, earnings are just OK... it’s hard to get people excited but the market keeps grinding higher,” said John Manley, chief equity strategist at Wells Fargo Funds Management in New York.
“It will be slow over the summer, but the market will have an upward bias.”
Apple Inc was due to report after the closing bell. The tech giant was expected to post a smaller quarterly profit and its financial report may come under intense scrutiny. The stock was down 0.8 per cent at $422.73.
European top shares closed lower on a late wave of selling, with semiconductors group STMicroelectronics leading the way down after weak results. The broad FTSE Eurofirst 300 index closed down 0.2 per cent at 1,208.41 points. StMicro tumbled 10.3 per cent.
Oil prices rebounded from early lows on optimism about China’s efforts to avert a hard-landing of its economy. Brent oil rose 40 cents, or 0.37 per cent, to $108.55 a barrel, while US crude futures were up seven cents, or 0.07 per cent, at $107.01 a barrel.
Gold prices fell 0.09 per cent to $1,333.84 an ounce as the dollar’s bounce prompted buyers to pause after the metal posted its biggest one-day price rise in more than a year on Monday. Gold has recovered nearly $160 from a three-year low of $1,180.71 on June 28.