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Nasdaq ends at record high on Yellen's comments

Updated: 06 19 , 2015 08:57
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NEW YORK -- U.S. stocks surged on Thursday, with the Nasdaq Composite Index surpassing its dotcom bubble peak set in March 2000, as investors took Federal Reserve Chair Janet Yellen's remarks as a dovish tone.

The tech-heavy Nasdaq touched a new intraday high of 5,143.32 points in early afternoon trading, breaking the 5,132.52 record it set on March 10, 2000, before finishing at 5,132.95, up 68.07 points, or 1.34 percent.

The Dow Jones Industrial Average jumped 180.10 points, or 1.00 percent, to 18,115.84. The S&P 500 leapt 20.80 points, or 0.99 percent, to 2,121.24.

After the conclusion of a two-day Fed policy meeting on Wednesday, the Fed signaled that it was on track to raise the benchmark interest rate this year despite the lower-than-expected economic outlook.

However, Yellen stressed that the importance of the initial increase should not be overstated, adding that the stance of monetary policy will likely remain highly accommodative for quite some time after the first interest rate hike.

"Basically, I think people are very confident in what the Federal Reserve has said. You also have a not-so-aggressive CPIreport today. The core CPI is very weak, which would push the Fed in the future to be less aggressive when raising rates," said Stephen Guilfoyle, managing director at Deep Value.

On the economic front, the Consumer Price Index (CPI) for all urban consumers increased 0.4 percent in May on a seasonally adjusted basis, slightly below market consensus, the U.S. Labor Department said Thursday.

The index for all items less food and energy rose 0.1 percent in May, its smallest increase since December.

"As oil prices stabilize, the freefall in the headline CPI is gradually receding into the past; however, just because inflation is no longer falling, it does not mean that it is yet time to worry about it rising enough to raise concern," said Sophia Kearney-Lederman, an economic analyst at FTN Financial, in a note.

In a separate report, the Labor Department announced the advance figure for seasonally adjusted initial claims was 267,000 in the week ending June 13, a decrease of 12,000 from the previous week's unrevised level of 279,000.

Overseas, the Eurogroup meeting ended without a deal over Greecedebt issue on Thursday.

"No agreement is in sight over Greece debt deal," Dutch Finance Minister and Eurogroup President Jeroen Dijsselbloem told press after Euro zone finance ministers' meeting in Luxembourg.

European shares closed higher despite the uncertainty of Greece on Thursday, with German benchmark DAX index at Frankfurt Stock Exchange rising 1.11 percent.

The CBOE Volatility Index, often referred to as Wall Street's fear gauge, dropped 9.03 percent to end at 13.19 Thursday.

In other markets, oil prices rose Thursday as U.S. dollar depreciated against other currencies. A weaker greenback made the dollar-priced crude less expensive and more attractive for buyers holding other currencies.

Light, sweet crude for July delivery moved up 53 cents to settle at 60.45 U.S. dollars a barrel on the New York Mercantile Exchange, while Brent crude for August delivery gained 39 cents to close at 64.26 dollars a barrel.

The U.S. dollar declined against most major currencies on the Fed's dovish tone about rate hikes Thursday.

In late New York trading, the euro moved up to 1.1368 dollars from 1.1333 dollars in the previous session. The greenback bought 123. 05 Japanese yen, lower than 123.38 yen of the previous session.

Gold futures on the COMEX division of the New York Mercantile Exchange surged on Thursday after the U.S. central bank made a statement indicating patience on the timing of interest rate hikes.

The most active gold contract for August delivery gained 25.2 dollars, or 2.14 percent, to settle at 1,202 dollars per ounce.