Wall Street continued its momentum into a second session overnight, as Janet Yellen’s testimony to Congress soothed fears about an end to quantitative easing.
Yellen fronted the US Senate for her confirmation hearing yesterday, where she outlined her reasons for continuing quantitative easing.
Early indications are that she will be sworn in as the next chairwoman of the US Federal Reserve once Ben Bernanke’s term expires at the end of January next year.
Stocks remained higher despite data showing little change in weekly US jobless claims and a smaller than expected rise in labour productivity during the third quarter.
The Dow rose 54 points (+0.3%) to 15876, the S&P500 climbed nine points (+0.5%) to 1791 and the Nasdaq put on seven points (+0.2%) to 3973.
Gold was a major beneficiary of Yellen’s testimony, particularly her comment that it was important not to remove monetary support in light of the fragile economic recovery.
Elsewhere, oil was held down by data showing an eighth consecutive weekly increase in US crude stockpiles.
Bullion soared 1.4% to US$1269 an ounce and front month oil futures ticked up slightly to US$93.90 a barrel. In currency markets, the US dollar held onto its recent gains despite mounting speculation Yellen will continue with the Fed’s easing policies.
There is no major economic data due for release today.