US stocks dip after Dow hits 16,000

NSYE trader US markets have been enjoying record high levels

Related Stories

The US Dow Jones index broke through the 16,000 level for the first time on Monday before giving up some of the gains in late trade.

At one point the Dow touched 16,030.28, but it ended 14.32 points up on the day at 15,976.02.

The S&P 500 index rose above 1,800 for the first time, before a late sell-off pushed it down 6.65 points to 1,791.53.

Stocks have been buoyed by hopes that the US central bank will continue with its economic stimulus programme.

The cheap money policy keeps interest rates low, which means investors are driven to find investments - such as shares - where they hope to find higher returns.

However, billionaire investor Carl Icahn told the Reuters news agency that he was "very cautious" on equities, adding that markets could see a "big drop".

Shares in Boeing rose 1.7% following news at the weekend that it had booked about $100bn (£62bn) in orders at the Dubai airshow.

But shares in social networks had a tougher day. Twitter fell 6.5% to $41.14 following a downgrade by Wunderlich Securities. Facebook's stock also dropped 6.5%.

'Dovish message'

Although the current chairman of the Federal Reserve, Ben Bernanke, is leaving the post, Janet Yellen, who is all but certain to take over from him, is expected to keep the money flowing while the US economy remains fragile.

Dow Jones Industrial Average

Last Updated at 11 Jul 2014, 15:59 ET *Chart shows local time Dow Jones intraday chart
value change %
16943.81 +
+28.74
+
+0.17

Top winner and loser

Verizon Communications Inc.

50.32 +
+0.68
+
+1.37

Chevron Corp.

128.47 -
-1.78
-
-1.37

Ms Yellen has said the Fed's the current extraordinary bond-buying efforts "certainly would continue for the foreseeable future".

She added that she does not see signs of a US stocks bubble.

"Financial markets are buoyed by Janet Yellen's comments at her confirmation last week, which re-iterated a dovish policy message from the Fed," said Neil MacKinnon of VTB Capital.

Earlier this month, it was announced that the US economy grew at a better-than-expected annual pace of 2.8% in the third quarter.

However, the latest figures also showed that the unemployment rate edged up to 7.3% from 7.2% in September.

The world's largest economy is not thought to be on solid enough ground to withstand the shock that could be caused by a change in policy.

Earlier, global shares were helped by rises in the Chinese stock market following announcements over economic and social reforms, including an intention to relax the one-child policy and abolish the controversial labour camp system.

China's Shanghai Composite rose by 2.9% and Hong Kong's Hang Seng index climbed 2.7%.

More on This Story

Related Stories

More Business stories

RSS

BBC Business Live

  1.  
    SCOTTISH INDEPENDENCE 06:08: Radio 5 live

    More from Sir Tom Hunter, he tells Wake Up to Money that Scotland's entrepreneurial spirit was "pretty much extinguished" by mining, steel making and ship building. He believes that children need to be encouraged to be entrepreneurial at school.

     
  2.  
    SCOTTISH INDEPENDENCE 06:07: Radio 5 live

    Wake Up to Money is in Aberdeen and interviews one of Scotland's richest men, Sir Tom Hunter. He says that politicians are doing voters a "disservice" in the independence debate by providing two completely different answers over what would happen to the pound if Scotland were to leave the union.

     
  3.  
    CURRENCY MARKET INVESTIGATION 06:01:
    canary wharf

    US prosecutors are offering immunity deals to junior traders in London as part of their investigation into manipulation of the currency markets, according to the lead story in this morning's Financial Times. The report says that junior staff have been offered the deals, in return for information about their superiors.

     
  4.  
    06:00: Emily Young, Business Reporter

    Morning all. The World Cup is over but don't worry the Farnborough Air Show has begun. We'll have updates from there throughout the morning.

     
  5.  
    06:00: Ben Morris Business Reporter

    Is British broadband a bit feeble? The Federation for Small Business thinks so and that's one of the issues under discussion this morning. Stay with the Business live page. You can emails us at bizlive@bbc.co.uk or tweet @bbcbusiness.

     

Features

BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.