US: Wall Street forges onward as oil producers brace for hurricane

[NEW YORK] Major Wall Street indices set records once again on Wednesday, shrugging off worries about a major hurricane approaching a key US oil-producing region and renewed coronavirus fears that had stymied indices elsewhere.

Hurricane Laura's imminent impact on the US Gulf Coast region sent oil prices climbing again and testing five-month highs.

Around three million barrels a day of refining capacity have been closed after US authorities said the hurricane could bring "potentially catastrophic storm surges, extreme winds and flash flooding."

Futures prices for US benchmark West Texas Intermediate spiked at mid-session to break above US$43.75 before slipping back slightly though still holding near a five-month high.

But the hurricane uncertainty did not deter traders elsewhere in New York, who pushed the S&P 500 and Nasdaq to yet another record high close while the Dow finished up 0.3 per cent despite weak opening momentum.

Apple gained 1.4 per cent ahead of its four-to-one stock split, while Salesforce.com, which will join the Dow index on Monday in place of global oil giant Exxon Mobil, leapt 26 per cent after a strong earnings report.

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Traders have been looking ahead to Thursday, when Fed Chair Jerome Powell will preview how the central bank signals the trajectory of interest rates in the coming months.

"Some of the stock market being up is a little bit of hopeful trading regarding this speech," JJ Kinahan of TD Ameritrade told AFP, suggesting observers might be disappointed.

- Coronavirus rears anew - Earlier in the day, London and Paris made only the most meagre of gains, not least over concern at the lingering presence of the coronavirus, although Frankfurt added 1.0 per cent.

"Second wave fears are becoming more real in Europe as a number of countries, particularly tourist destinations such as Spain and France, are seeing a strong rise in Covid-19 cases," City Index analyst Fiona Cincotta said.

"Governments... are showing reluctance to slap nationwide lockdowns into place just yet but investor concerns are growing."

While there are signs that Covid-19 is leveling off in the US, other countries are fighting to subdue new flare-ups, with Spain notably saying Tuesday it would call in the army and South Korea again closing schools and kindergartens in the greater Seoul region.

Observers warned the upcoming winter could see more infections as people are forced to stay indoors.

"The situation is still far better than it was in the spring," AxiCorp analyst Stephen Innes said.

"However, recent momentum and outbreaks around the world are worrying, as second- and third-wave coronavirus outbreaks still pose the most significant threat to the economic recovery."

AFP