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US stocks up on growth data

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US stocks have closed higher Friday morning following an upgrade to US second-quarter economic growth and a shift in expectations away from an immediate military strike on Syria.

The Dow Jones Industrial Average rose 16.44 (0.11 per cent) to 14,840.95.

The broad-based S&P 500 added 3.21 (0.20 per cent) at 1,638.17, while the tech-rich Nasdaq Composite Index increased 26.95 (0.75 per cent) to 3,620.30.

US economic growth in the second quarter came in at an annual rate of 2.5 per cent, faster than the original estimate of 1.7 per cent, the Commerce Department said.

Stronger consumer spending and exports underpinned the pickup from the first quarter’s sluggish 1.1 per cent pace, while imports grew more slowly than originally estimated, the department said.

In addition, market watchers have been calmed by an apparent shift from the US, Britain and France in the timing of any military strike against Syria in response to its alleged chemical warfare attack on its people.

“There just seems to be less urgency about an attack any time soon,” said Alec Young, global equity strategist for S&P Capital IQ.

“The stress level has come down a little.”

The Australian dollar was lower the US economic data raised expectations the US Federal Reserve will scale back its asset purchases in the coming months.

On Friday morning the local unit was trading at 89.29 US cents, down from 89.58 cents on Thursday.

Most major currencies fell against the US dollar as investors believed the data might mean a winding down of the Fed’s economic stimulus program.

 

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