Stocks held their sharp gains across the board on the first trading day of September, lifted by a handful of better-than-expected economic reports and amid fading worries of an imminent attack on Syria.
The Dow Jones Industrial Average rallied nearly 100 points, fueled by JPMorgan and United Technologies, after posting its worst monthly drop since May 2012. Verizon and Microsoft were sharply lower.
The S&P 500 and the Nasdaq also jumped. The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, traded below 17.
Most key S&P sectors were in positive territory, led by consumer discretionary and financials, while telecoms lagged.
On the economic front, the manufacturing sector grew last month to 55.7 in August, its fastest pace in more than two years, according to the Institute for Supply Management. A reading above 50 indicates expansion in the sector.
U.S. construction spending rose in July as more outlays to build homes and businesses countered a decline in the government sector.
And construction spending gained 0.6 percent to an annual rate of $901 billion, according to the Commerce Department, topping expectations for a gain of 0.3 percent.
Congress will hold its first public hearing about U.S. plans for military intervention in Syria as President Barack Obama seeks to convince skeptical Americans and their lawmakers about the need to respond to last month's alleged gas attack outside Damascus.
Obama struggled to win over skeptical lawmakers from both parties over the weekend, and congress will now only debate a strike when it returns from its summer recess on September 9.
Meanwhile, a Russian news agency reports that two "ballistic objects" had been launched towards the eastern Mediterranean revived concerns about a U.S.-led strike on Syria. Israel's Ministry of Defense confirmed that Israeli forces and the U.S. Missile Defense Agency had carried out a missile test and said Israel would release further information about the launch soon.
On Monday, Verizon said it will pay $130 billion to acquire Vodafone's 45-percent stake in their Verizon Wireless joint venture, marking the third-largest deal in corporate history.
Vodafone's CEO told CNBC that he will use the cash earned from the deal to accelerate investment in Vodafone's own wireless networks, and to return $84 billion in cash and shares to shareholders.
"We are fortunate enough that the size of the deal itself allows us to return a large percentage to shareholders. But even the remaining 21 percent is large enough to strengthen the company and to allow us to accelerate our strategy," CEO Vittorio Colao said.
Microsoft said it will buy Nokia's handset business for $7.2 billion. Nokia CEO Stephen Elop, a former Microsoft executive, will rejoin the company and is now seen by some as a candidate to replace retiring CEO Steve Ballmer.
Meanwhile, Time Warner Cable and CBS reached and agreement Monday, ending a month-long blackout, returning the broadcast network's programming to millions of subscribers in Los Angeles, New York and Dallas. CBS rallied to lead the S&P 500 gainers.
The Japanese Nikkei led Asian stocks higher on Tuesday, after better-than-expected manufacturing data from Europe and China lifted hopes that a global economic recovery was in progress.
Data out on Monday showed Chinese manufacturing hit a four-month high in August and euro zone factory activity rose at its fastest pace since May 2011. On Tuesday, data revealed that the U.K.'s construction sector expanded at its fastest pace in almost six years in August.
0 comments:
Post a Comment