NEW YORK—The U.S. stock market rose again last Friday, continuing an upward trend that had the Dow Jones Industrial Average reaching its highly intraday level since June 2008.
All three indices pushed higher again last Friday. The blue-chip Dow increased 73.11 points, or 0.59 percent, to its highest level since mid-2008, while the S&P 500 Index gained 2.6 points (0.2 percent). The technology-heavy Nasdaq Composite Index increased by 2.4 points, or 0.08 percent.
The rally closed another positive week for Wall Street. The Dow has been in the black for the 11th week in the past 12 weeks, as investors look to take a long break during President’s Day weekend.
“You’ve had a pretty good dose of negative news and yet the market just keeps going up,” RBC Wealth Management Director of Equity Strategy Phil Dow told Dow Jones.
G-20 Ministers Talk Inflation, Global Balances
Investors turned their eyes to Paris, where economic ministers were attending a G-20 summit.
U.S. Federal Reserve President Ben S. Bernanke said that volatile and excessive cash inflows into emerging economies, such as China, could pose a significant threat to the global economy if they are not due prudently.
“The global financial crisis is receding, but capital flows are once again posing some notable challenges for international macroeconomic and financial stability,” Bernanke said at a meeting of finance ministers and central bank governors on Friday, according to a transcript of the speech.
Bernanke suggested that such cash flows could cause inflation to go up and create asset bubbles and currency valuation troubles—in turn affecting the global economy at large. China in recent days has tightened its monetary policy in an effort to curb concerns of inflation.
“We need to clarify and strengthen the rules of the game,” Bernanke said, “to achieve a more balanced international system over time.” He also suggested that nations should allow their currency exchange rates to better reflect market fundamentals, perhaps in reference to China.
But according to reports, the finance ministers had a hard time agreeing exactly what steps to take to foster economic stability.
French President Nicolas Sarkozy told reporters that nations should not place too highly its “self interest,” while Dow Jones reported that Bank of Japan Governor Masaaki Shirakawa lamented that today’s interconnection among nations means that one country’s economic policy would have spillover effects upon others.
Oil Futures Rise Again
Continued unrest in the Middle East has put pressure on oil prices. Bahrain’s authorities were reported to have opened fire against protesters as the Muslim nation’s Shiite Muslim majority population has demanded more say in the Sunni-dominated government.
Earlier in the day, Brent crude futures—benchmark for Europe—sold in London gained 0.3 percent to $102.91 per barrel, reflecting supply concerns due to the instability in the Middle East, which could disrupt oil transportation from the Middle East to Europe through the Suez Canal in Egypt.
According to AAA, an automobile organization, average U.S. gasoline price increased 1.1 cents to $3.156 per gallon last Thursday.
