US stock markets remained bullish on Thursday on decision of Federal Reserve to buy Treasuries which will stimulate the sluggish economy.
The Dow Jones Industrial Average DJIA surged 1.6% or 181points to close at 11,369 levels. DJIA reached its highest level since September 2008. In September 2008 the DJIA touched its fell considerably on bankruptcy filing of Lehman Brothers.
Standard & Poor’s 500 share index climbed 1.5% to close at 1,216 while NASDAQ Composite surged 1.3% to 2,573 for the day.
Materials and energy sector contributed the most to the Standard & Poor index. Caterpillar surged 3.4%, Boeing climbed 2.9% while American Express jumped 2.7% contributing to the bullish sentiments at DJIA.
Investors remained enthusiastic about the market on the Federal Reserve’s plan to buy additional $600 billion worth of long term Treasury securities by June next year. The Federal Reserve also plans to reinvest the principal payments from the securities holdings.
Chief Investment Officer David Carter from Lenox Advisors commented, “Investors love the size of the Fed’s QE2 announcement, nobody knows if this QE2 thing is going to work, but the market is saying its show time and let’s see what it can do.”
Among other main stocks Potash Corp dropped 3.9 percent on rejection by Canadian government of BHP Billiton’s $38.6 billion bid. Time Warner Cable also posted its 3rd quarter earnings which surged by 34 percent surpassing analysts’ forecasts. Time Warner’s share price climbed 4.9 percent in last trading session.
DirecTV Group also announced their 3rd quarter results according to which the company’s net profit gained 31% as compared to last year. The share price however declined 3.2 percent.