Stocks head higher after ECB takes news steps
Thursday, June 5, 2014
NEW YORK (AP) — New steps from the European Central Bank to revive the region’s flagging economy gave markets a lift Thursday, pushing the Standard & Poor’s 500 index to another record high.
In the U.S. market, the gains were broad but modest. All 10 industries in the S&P 500 crept higher, led by industrial companies and banks.
The ECB cut two key interest rates, pushing one of them below zero. The unusual move means that the ECB will charge banks to hold their money, instead of paying them interest. The goal is to arm-twist banks into lending money rather than stockpiling it.
The Standard & Poor’s 500 index rose 12.58 points, or 0.7 percent, to close at 1,940.46.
The Dow Jones industrial average rose 98.58 points, or 0.6 percent, to 16,836.11. The Nasdaq composite gained 44.58 points, or 1.1 percent, to 4,296.23. Both the S&P 500 and the Dow average are at record-high levels.
Germany’s main stock index, the DAX, touched a record high before pulling back and ending the day with a gain of 0.2 percent. France’s CAC 40 surged 1.1 percent.
The U.S. and Europe are tightly connected through financial markets, the banking system and trade. Added together, the countries in the European Union make up the world’s second-largest economy and buy roughly a fifth of all U.S. exports.
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