SalemNews.com, Salem, MA

Nation/World

October 18, 2013

S&P 500 reaches all-time high after US debt deal

(Continued)

Other indexes also posted big gains. The Nasdaq composite closed up 23.71 points, or 0.6 percent, to 3,863.15.

The Russell 2000 index, which is made up of primarily smaller, riskier companies, also hit an all-time high. It closed up 9.85 points, or 0.9 percent, to 1,102.27 and has risen nearly 30 percent this year.

Market analysts think the 16-day partial shutdown of the government caused billions of dollars of damage to the economy. Government employees were furloughed, contracts were delayed, and tourism declined at national parks.

Analysts at Wells Fargo said the shutdown likely lowered economic growth by 0.5 percentage point.

There remain broader concerns that Democrats and Republicans won’t be able to draw up a longer-term budget. The deal approved late Wednesday only permits the Treasury Department to borrow through Feb. 7 and fund the government through Jan. 15.

“The agreement represents another temporary fix that pushes fiscal uncertainty into the early months of next year,” Wells Fargo analysts said.

Despite the worries, signs of normalcy returned to financial markets yesterday.

The one-month Treasury bill was back to trading at a yield of 0.01 percent, about where it was a month ago, and down sharply from 0.35 percent on Tuesday.

Usually a staid, conservative security, the one-month T-bill was subjected to a wave of selling at the beginning of the month. Investors feared the T-bill would be the first piece of government debt to be affected by a U.S. default if the debt ceiling was breached and the federal government could no longer pay its obligations.

The yield on the more closely-watched 10-year Treasury note fell to 2.60 percent from 2.67 percent Wednesday.

Text Only | Photo Reprints
Nation/World

Local News
  • Coast Guard searching for missing diver off Marblehead

    The U.S. Coast Guard is searching for a 56-year-old scuba diver who has been reported missing off Children's Island in Marblehead.

    A Coast Guard spokesman said the male diver was reported as "overdue" at 11 a.m. on Tuesday. The man's boat is moored off Children's Island.

    July 22, 2014

  • 140721_SN_DLE_MARKETBASKET5 North Shore Market Basket workers, customers remain defiant

    MIDDLETON -- The Market Basket revolt continues, despite the firing of eight insurgent employees. Workers at the Middleton store on Monday were still making clear their position in favor of ousted CEO Arthur T. Demoulas, though in some cases with ca

    July 21, 2014 5 Photos 5 Stories

  • Lindsay Obama denies religious exemption urged by Gordon College president

    WENHAM — The letter that has caused so much controversy for Gordon College has gone unheeded by President Barack Obama.

    July 21, 2014 1 Photo 7 Stories

  • 140721_SN_PBI_MARKETB_090 Thousands rally after 8 Market Basket execs are fired

    TEWKSBURY -- Valerie Edge has never been afraid for her job. Through the death of her father, a near-fatal crash involving her daughter, and her own lengthy illness, the five-year employee of the Epping, N.H., Market Basket said her bosses always tol

    July 22, 2014 4 Photos 1 Slideshow 4 Stories

  • Tobin Bridge toll booths are history BOSTON -- The next time you drive over the Tobin Bridge on Route 1 into Boston, you won't have to fumble for your wallet or root through your purse to pay the toll. On Monday, the state Department of Transportation replaced the toll booths on the upp

    July 22, 2014