New York: Wall Street shrugged off a series of grim corporate and economic reports and swung higher in opening trade Tuesday as the market awaited a likely cut in interest rates from the Federal Reserve.
The Dow Jones Industrial Average climbed 59.74 points (0.7%) to 8,624.27 and the Nasdaq added 21.08 points (1.4%) to 1,529.42 in the first trades, rebounding from losses Monday.
The broad market Standard & Poor’s 500 index increased 9.71 points (1.12%) to 878.28.
The market cautiously awaited a decision by Federal Reserve policymakers, who were expected to cut the base lending rate from its current historic low of 1%, bringing the rate close to zero in an effort to stimulate the economy.
Traders looked past an unprecedented $2.12 billion (Rs10,133 crore) loss by Wall Street icon Goldman Sachs Group Inc. as well as a plunge in US housing starts to a new record low and a record steep fall in consumer prices that highlighted fears about deflation.
“When bad news produces good results, that is a very good development,” said Al Goldman at Wachovia Securities.
“No one knows when a market is totally washed out, but one strong indication is when bad is good.”