US markets gain; S&P 500 marks longest rally in 2014

The US markets closed higher on Tuesday, with the S&P 500 extending its winning streak to sixth day, the longest streak of gains since September 2013. On the economy front, the Federal Housing Finance Agency reported that home prices rose a seasonally adjusted 0.6% in February, and were up 6.9% from the year-ago period. In January, prices rose a downwardly revised 0.4% compared with the initial estimate of a 0.5% gain. Separately, the sales pace of existing homes ticked down in March to the slowest rate since July 2012, showing weakness in the early spring sales season, though underlying trends signal a firming in market fundamentals. The National Association of Realtors reported that the annual sales pace of existing homes declined 0.2% last month to a seasonally adjusted annual 4.59 million. Meanwhile, John Williams, president of the San Francisco Federal Reserve, stated that Federal Reserve policy is on the right track and efforts to try to spur faster growth might be counterproductive. Williams predicted that unemployment rate will keep falling and hit 5.5% by the end of 2015. Over the same period, inflation should move higher and come close to the Fed’s 2% target. Williams enlightened that trying to achieve these goals of full employment and price stability any sooner would take policy actions that might have more negative effects, such as possibly contributing to risks with financial stability. The Dow Jones Industrial Average added 65.12 points or 0.40 percent, to 16,514.37, the Nasdaq Composite was up by 39.91 points or 0.97 percent, to 4,161.46, while the S&P 500 gained 7.66 points or 0.41 percent, to close at 1,879.55. The Indian ADRs closed mostly in red on Tuesday; Wipro was down by 0.5%, Infosys was down 0.40% and ICICI Bank was down 0.20%. On the other hand, Tata Motors was up 0.50% and Dr. Reddy’s Lab was up 0.20%.