Stocks rose modestly on Wednesday, after a German court ruled in favour of a permanent euro zone bailout fund, providing a little more optimism about the ongoing debt crisis.
The Dow Jones industrial average closed at 13,333.35, up 9.99 points or less than 0.1 per cent – good enough to establish a new high since late 2007.
The broader S&P 500 closed at 1436.56, up 3 points or 0.2 per cent. In Canada, the S&P/TSX composite index closed at 12,232.62, up 12.17 points or 0.1 per cent.
Germany’s Federal Constitutional Court cleared the way for the country’s €190-billion contribution to the euro zone’s bailout fund, easing concerns about whether the region is making headway on the crisis.
The ruling sent the euro to a four-month high and helped drive Germany’s DAX index up 0.5 per cent. The U.K.’s FTSE 100 fell 0.2 per cent.
In the U.S., there was more upbeat news on the housing sector. CoreLogic reported that the number of U.S. homeowners with a mortgage, but who had negative equity, fell to 22.3 per cent at the end of June – down from 23.7 per cent at the end of the first quarter – providing new evidence that stresses on the housing market are easing. Homebuilding stocks jumped on the news: PulteGroup Inc. rose 6 per cent and Toll Brothers rose 4.2 per cent.
Meanwhile, the Federal Reserve began a two-day meeting, which culminates in the release of its monetary policy statement on Thursday. Many observers believe the Fed could reveal another round of policy stimulus to give the struggling economy a boost.
Apple Inc. jumped in the final hour of trading, ending the day up 1.4 per cent after it unveiled a new bigger-but-slimmer version of its iPhone.
Commodity prices were stable. Crude oil fell to $97.01 (U.S.) a barrel, down 16 cents. Gold fell to $1,733.70 an ounce, down $1.20.
Among Canadian commodity producers, Suncor Energy Inc. rose less than 0.1 per cent and Barrick Gold Corp. rose 0.9 per cent.