While you were sleeping: Wall St, US dollar rise on rate bets

Wall Street and the US dollar advanced a day after Federal Reserve chairwoman Janet Yellen bolstered expectations the central bank will raise interest rates once more this year.

"Yellen's speech continued to be more along the lines of: We don't have much evidence of inflation, but we're going to plan on raising rates anyway because we have faith that inflation is returning," John Briggs, head of US rates strategy at NatWest Markets, told Bloomberg. "On a relative basis, she was certainly more hawkish" than other central bankers.

At the close of trading in New York, the Dow Jones Industrial Average advanced 85.24 points, or 0.4%, to 22,956.97, a new closing record.

The Nasdaq Composite Index added 0.3% to 6624.00 and the Standard & Poor's 500 Index rose 0.2% to 2557.64. Earlier, the S&P 500 reached a record 2559.47 and the Nasdaq climbed to a record 6632.50.

US Treasuries fell, sending yields on the 10-year note two basis points higher to 2.29%.

Investors are also eyeing a slew of corporate earnings scheduled for release this week including by Goldman Sachs, Morgan Stanley, General Electric and Netflix.

Optimism on earnings
Of the 32 S&P 500 companies that have reported so far, 84.4% beat earnings expectations, according to Thomson Reuters data.

"There is optimism on earnings, economic indicators and hopes of budget resolution." Jeff Zipper, managing director at the US Bank Private Client Reserve in Palm Beach, Florida, told Reuters.

The Dow climbed as gains by JP Morgan Chase and Apple, up 2.1% and 1.8% respectively, outweighed slides by Wal-Mart and American Express, down 1.5% and 1.0% respectively.

Nordstrom shares sank 5.3% after the company said members of the Nordstrom family have "suspended active exploration, for the balance of the year, of the possibility of proposing a transaction to take the company private."

In a statement, Nordstrom said "it intends to continue its efforts to explore the possibility of making a going private proposal after the conclusion of the holiday season." Earlier, Nordstrom shares fell as low as $US39.63 before closing at $US40.40.

"It's difficult to make a case for private equity investing in these legacy retail companies when the play is really not about growing the company so much as right sizing it," Neil Saunders, retail analyst at Global Data, told Reuters.

In Europe, the Stoxx 600 Index ended little changed. Germany's DAX Index rose 0.1%, France's CAC 40 Index added 0.2% and the UK's FTSE 100 Index slipped 0.1%.

(BusinessDesk)