The S&P 500 closed at a new high on Wednesday after Federal Reserve Chairman Jerome Powell told Congress that the central bank plans to maintain its easy monetary policy amid rising U.S. inflation. The Dow Jones also closed higher, but the Nasdaq slipped slightly lower. However, the Nasdaq 100 closed at a fresh record as Apple
The blue-chip index is up more than 16% in 2021 and more than 36% in the past 12 months.
Here's how the market closed Wednesday:
S&P 500 Index
Dow Jones Industrial Average
Nasdaq Composite Index
Fed Chair Powell supports current monetary policy before Congress:
In his semiannual testimony before Congress on Wednesday, Federal Reserve Chairman Jerome Powell said the U.S. economic recovery has not progressed enough to start tightening the central bank's loose monetary policy. Powell also reiterated that he expects inflation to stay high in the coming months before moderating.
"At our June meeting, the Committee discussed the economy's progress toward our goals since we adopted our asset purchase guidance last December," Powell told the House Financial Services Committee, quoted by Bloomberg. "While reaching the standard of 'substantial further progress' is still a ways off, participants expect that progress with continue."
Here's how the market started trading after opening bell:
S&P 500 Index: +0.44% or +19.19 points to 4,388.40
Dow Jones Industrial Average: +0.45% or +155.41 points to 35,044.20
Nasdaq Composite Index: +0.70% or +99.95 points to 14,779.61
Producer prices surge higher in June:
Producer prices surged at a higher-than-expected rate in June as supply chain constraints and shortages pressured prices higher for a broad range of goods.
The Bureau of Labor Statistics Producer Price Index (PPI) rose by a more-than-expected 1.0% over May in June, with roughly 60% of the increase coming from a surge in service sector prices. Compared to last year, the PPI climbed 7.3% higher, coming in well about May's 6.6% increase, marking the fastest rise on record.
Mortgage application volume increases most since January:
Mortgage application volume rose by the most since January last week as the dip in interest rates attracted buyers in the housing market.
The Mortgage Bankers Association's (MBA) weekly mortgage index rose 16% week-over-week during the period ended July 9. Refinances increased by 20% over last week, but were still 29% lower compared to the comparable week in 2020. Purchases were up 8% on the week, including a seasonal adjustment for the Fourth of July holiday. On an unadjusted basis, purchases were down 13% week-over-week and were down 29% over last year.
"Overall applications climbed last week, driven heavily by increased refinancing as rates dipped again. Treasury yields have trended lower over the past month as investors remained concerned about the COVID-19 variant and slowing economic growth," said Joel Kan, MBA's associate vice president of economic industry forecasting, in the a press statement. "Mortgage rates fell for the second consecutive week as a result, with the 30-year fixed rate hitting 3.09%, its lowest level since February 2021."
