Broad market equities and stock exchange traded funds stumbled around in sideways trading at the start of the week but jumped as a combination of economic strength and accommodative central bank policies pushed the Dow and S&P 500 to all-time highs.
The S&P 500 gained 0.8% this week while the Dow Jones Industrial Average was up 0.4% and the Nasdaq Composite rose 2.1%.
This week’s action began after the FOMC meeting Wednesday revealed the U.S. economy was expanding at a “moderate” pace with “persistently” low inflation pressure. The markets expected the Fed to push off any tapering as the Fed continued with its current loose monetary policy. [Accommodative Fed Measures to Support Stock Market, ETFs]
After a day to digest the news, broad market indices spiked, with the S&P 500 crossing over the 1,700 marker for the first time and the Dow hitting a new record close of 15,628. [Stock ETFs Rally as S&P 500 Crosses 1,700]
Meanwhile, lower jobless claims pointed to an improving jobs market and a positive ISM report revealed an stronger-than-expected manufacturing sector.
However, the equities market was relatively flat Friday following a less-than-expected growth in payroll employment for July and a moderate increase in personal income and personal spending.
Over the past week, equities attracted $6.6 billion in new inflows and $5.3 billion of which went into ETFs, Barron’s reports.