Wall Street climbs on recovery optimism

September 22, 2009
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, NEW YORK, Sept 22 – US shares climbed on Tuesday to around fresh 11-month highs on economic recovery optimism and company earnings prospects ahead of a Federal Reserve policy level meeting and Group of 20 summit.

The Dow Jones Industrial Average rose 40.88 points (0.42 percent) to 9,819.74 in opening trades, a day after falling slightly due to profit taking.

The tech-heavy Nasdaq composite rose 10.29 points (0.48 percent) to 2,148.33 while the broad-market Standard & Poor\’s 500 index added 5.96 points (0.56 percent) to a new 11-month high of 1,070.62.

"Wall Street appears to have shaken off Monday\’s blues in favor of a more upbeat outlook on the economy, even as the Federal Open Market Committee (FOMC) kicks off its meeting to discuss US monetary policy," said Joseph Hargett of Schaeffer\’s Investment Research.

The added confidence, he said, had pressured the safe-haven US dollar lower, pushing greenback-priced commodities such as oil and gold higher.

"The dollar’s continued weakness is boosting commodity prices that are denominated in the US currency, helping the major markets rebound from yesterday’s modest declines," analysts at Charles Schwab & Co said in a note to clients.

Upbeat company earnings reports were also helping lift sentiment in early action, they said.

The two-day FOMC meeting begins in Washington Tuesday and the Group of 20 summit convenes in the US city of Pittsburgh, Pennsylvania, on Thursday.

The Fed is widely expected to leave unchanged its near-zero base interest rate but may make minor changes to the array of liquidity programs to keep credit flowing as the economy struggles to emerge from recession.

Leaders of the G20 key developed and developing countries are expected to discuss ways to unwind their unprecedented support to fight the global economic crisis although they remain cautious for fear of jeopardizing a return to growth.

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