US close: Stocks end session higher following Powell testimony
By Iain Gilbert
Date: Tuesday 22 Sep 2020
(Sharecast News) - Wall Street closed higher on Tuesday after testimony from Federal Reserve Chairman Jerome Powell earlier in the day.
At the close, the Dow Jones Industrial Average was up 0.52% at 27,288.18, while the S&P 500 was 1.05% firmer at 3,315.57 and the Nasdaq Composite saw out the session 1.71% stronger at 10,963.64.
The Dow Jones closed 140.48 points higher on Tuesday, putting an end to four-day losing streak as Chinese trade relations, a potential second wave of the Covid-19 pandemic and stimulus negotiations were all in focus.
Tuesday's main focus was Powell's testimony before the House of Representatives Financial Services Committee.
Powell told the House that the Fed stands ready to use all of the tools at its disposal to assist the recovery of the economy and limit the lasting damage from the Covid-19 pandemic's effect on the nation.
News that Donald Trump would announce his Supreme Court nominee to replace the recently deceased Ruth Bader Ginsburg on Saturday was also in focus amid concerns around how her death will affect ongoing stimulus negotiations on Capitol Hill.
Chicago Fed President Charles Evans actually cautioned earlier in the day that every month that passes without additional fiscal support from the White House risked "recessionary dynamics".
Investors were also keeping a keen eye on headlines from across the pond after British prime minister Boris Johnson said the UK was at a "perilous turning point" in its battle against the Covid-19 pandemic and announced further restrictions on businesses and Britons.
On the macro front, existing home sales rose 2.4% in August to a seasonally adjusted rate of 6.0m units, according to the National Association of Realtors. Sales were 10.5% higher year-on-year, marking the highest sales pace since December 2006, before the Global Financial Crisis.
Elsewhere, the Richmond Federal Reserve Bank's manufacturing index increased from 18 in August to 21 in September, well ahead of expectations for a reading of 12 and buoyed by increases in the indicators for new orders and employment.
No major corporate earnings were slated for release on Tuesday.
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