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US: Dow ends at fresh record as markets await ECB
[NEW YORK] Wall Street roared back into record territory on Tuesday following strong earnings from leading industrial companies, while European equities edged higher ahead of a key ECB meeting.
The Dow Jones Industrial Average jumped to its sixth record in seven sessions following huge gains by Caterpillar and 3M following strong earnings.
The Dow's 0.7 per cent rise came one day after US equities had faltered in a rare pullback from a record-rich run over the last month.
Nearly 200 companies in the S&P 500 are set to report results this week, making it a crucial stage of the quarterly cycle. The excellent back-to-back results by Caterpillar and 3M lifted sentiment about industrials in general.
"We are seeing a rotation into stocks that are very sensitive to economic growth," said Alan Skrainka, chief investment officer at Cornerstone Wealth Management.
Mr Skrainka said investors have also been cheered by progress in Washington on tax cuts.
In the eurozone, business activity across the single currency area slowed in October, a key survey showed Tuesday, but job creation hit the fastest pace in a decade as the economic recovery in Europe stayed on track.
A purchasing managers' index (PMI) compiled by Markit dipped to 55.9 in October after 56.7 in September, the group said in a statement.
Traders were looking ahead to Thursday, when the European Central Bank is set to announce a big reduction in its financial stimulus support for a recovering eurozone economy.
The ECB began buying massive amounts of bonds in 2015 to fight the threat of deflation - a damaging downward spiral of prices and activity.
Since then, the state of the eurozone economy has improved, and the ECB on Tuesday said that households across the single currency bloc enjoyed easier access to credit in the third quarter of 2017.
The ECB closely watches lending data to gauge the effectiveness of its ultra-loose monetary policy, which aims to bolster growth and inflation in the single currency area by encouraging spending and investment.
Earlier, Tokyo's Nikkei led another broad advance across Asian markets, with the index chalking up its 16th straight gain to extend an impressive record streak.
The Japanese market pushed to fresh 21-year highs on the back of a weaker yen and hopes that Prime Minister Shinzo Abe's weekend election landslide victory will usher in further measures to boost the world's number three economy.
Tokyo ended up 0.5 per cent to continue the best run of gains in its near 70-year history.