Business World

Saturday 22 September 2018

Move to end US shutdown buoys stocks

A banner for American International Group Inc (AIG) hangs on the facade of the New York Stock Exchange
A banner for American International Group Inc (AIG) hangs on the facade of the New York Stock Exchange
Gavin McLoughlin

Gavin McLoughlin

Stocks and Treasuries gained, while the dollar erased losses in afternoon trading in New York, after the US Senate approved a bill to end the US Government shutdown.

All major equity gauges rose after lawmakers voted to end a partial government shutdown that has lasted three days. The dollar reversed losses and 10-year treasuries edged higher. The S&P 500 Index gained following a third straight weekly advance as investors awaited about 80 earnings reports this week.

Equity investors had appeared mostly undecided over the latest US government drama, weighing it against the optimism over economic growth and profit increases that pushed many stock indexes to all-time highs. Meanwhile, the next catalyst for bonds may come from European and Japanese central bank decisions this week. Signals that unprecedented stimulus will soon be wound back has sparked a surge in yields this month.

Elsewhere, West Texas oil fell after OPEC and Russia said output cuts will continue until the end of the year. The MSCI Emerging Market Index of stocks rose a seventh day, poised for the longest winning streak in six months as the likes of Goldman Sachs and Blackstone joined the chorus of developing-nation bulls.

Traders monitored China's appetite for a stronger currency as the yuan touched the symbolically key level of 6.4 per dollar. South Africa's rand touched its highest since 2015 on speculation President Jacob Zuma may be forced to leave office.

At home, the ISEQ index of Irish shares was essentially unchanged, rising 0.01pc to close at 7157.50. Despite a report that the UK government plans to slash the amount punters can bet on fixed-odds betting terminals, Paddy Power Betfair closed down just 0.63pc, paring earlier losses.

Additional reporting by Bloomberg

Irish Independent

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