Stocks Close Mixed, Nasdaq Extends Gains
Stocks began the Wednesday trading session mixed, after surging on Tuesday notching up more than 1% gains. All three major indices closed in the black Tuesday after Fed Chair Janet Yellen testified in front of congress for the first time. Chinese economic data was better than expected lifting minors and growth oriented stocks, while the house pasted a clear debt ceiling bill that will keep the government operating until March of 2015. After an up and down day, US stock closed mixed with the Nasdaq as the only major index closing in the black.
Stocks were buoyed on Tuesday as new Fed Chair Janet Yellen pledged to retain the Fed’s very accommodative money policies, and follow the course set by her predecessor. Yellen discussed the need to monitor economic data and retain a flexible policy that will continue to promote growth and increase inflation.
The Yellen testimony overshadowed an important vote in the House of Representative which allowed the debt ceiling to increase without stipulations. The House has authorized a one-year extension to the government’s borrowing authority until March 16, 2015 without any conditions by a vote of 221-201. The measure now needs to be approved in the Senate. The last debt ceiling debate lasted nearly 6-months and came down to the wire as the government closed for more than 2-weeks. The vote moved on to the Senate which also approved the debt ceiling on Wednesday.
Also giving a lift to stocks was the better than expected Chinese trade data released on Wednesday. China’s exports accelerated to +10.6% year over year in January and easily beat consensus estimates which were for a rise of just 2%. Imports increased 10% versus the 3% consensus estimate.
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