Chronicle Journal: Finance

S&P 500, Nasdaq close at new highs as investors look to upcoming speech from Fed Chair Powell

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US stocks closed at record highs Wednesday as investors awaited a key speech by Federal Reserve Chair Jerome Powell later this week during the high-profile annual Jackson Hole conference of central bankers.

The benchmark S&P 500 attained its 51st record close of the year, though climbed only modestly throughout the trading session. The tech-heavy Nasdaq 100 also closed at a new high while the Dow Jones Industrial Average ended higher.

Here's where US indexes stood at 4:00 p.m. ET close on Wednesday:

Major US indexes have been scaling new heights despite the surge in the spread of the Delta variant. 

All eyes will be on Powell's speech for any indication of when the central bank will reduce its support for the US economy by winding down asset purchases. 

According to Paolo Zanghieri, senior economist of Generali Investments, investors should not expect clear communication about the shape and timing of the tapering for two reasons.

First, while recent economic data remain strong, he said momentum is receding. The recent surge in COVID-19 cases may also dampen growth and risk partial lockdowns, he added.

Second, the Federal Open Market Committee, which will hold its next meeting in September, has not met yet, he said, adding the minutes of the recent meeting "clearly" indicate there is no timeline for tapering. 

"There could be a partial assessment of the economic situation, broadly along the lines of the July meeting," Zanghieri said in a note Wednesday. "An assessment on how the evolution of the labor market stack up with the Fed's view of full employment. The transitory inflation mantra should be reiterated."

Meme stocks were riding a renewed wave of enthusiasm from Reddit, as traders pile into old favorites amid a fresh wave of gains.

Among the most hyped stocks on Wall Street Bets were GameStop, AMC EntertainmentBlackberry, and Clover Health.

Shares of Cassava Sciences plunged as much as 30% after a lawyer questioned the integrity of its experimental treatment for patients suffering from Alzheimer's.

As for US-listed Chinese stocks, weekly data by Vanda Research showed retail purchases hitting their highest in five years in the face of a crackdown by Beijing.

US bond yields fell slightly on Wednesday, with the key 10-year US Treasury yield slightly lower at 1.347%. Yields move inversely to prices.

Oil prices surged following a deadly fire on a Mexican offshore oil rig.

West Texas Intermediate crude rose 1.36% to $68.46 per barrel. Brent crude, oil's international benchmark, gained 1.83%, to $72.35 per barrel.

Gold slipped 0.58% to $1,791.62 per ounce. 

Bitcoin slipped to $48,872.30 after briefly breaching the $50,000-level earlier in the week.

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