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Tuesday, October 25, 2016

U.S. Stocks Rise On Better Data From China And Europe

NEW YORK (AFP) – U.S. stocks Tuesday moved higher after a holiday weekend helped by solid economic data from China and Europe and Washington’s pullback from its threat of an imminent strike on Syria.

About 35 minutes into trade, the Dow Jones Industrial Average gained 92.09 (0.62 percent) to 14,902.40.

The broad-based S&P 500 picked up 15.91 (0.97 percent) at 1,648.88, while the tech-rich Nasdaq Composite Index rose 43.23 (1.20 percent) to 3,633.10.

Markets resumed trading after Monday’s Labor Day holiday. Over the weekend, HSBC’s China purchasing managers’ index (PMI), a key benchmark of manufacturing activity, rebounded to 50.1 in August, its first month of expansion since April.

Also, the eurozone PMI compiled by Markit Economics jumped to 51.4 points in August from 50.3 in July.

Anxiety among investors also ebbed as the prospects for an immediate U.S. strike on Syria sank with the Obama administration’s decision to seek congressional approval for the action.

Dow component Verizon fell 4.4 percent one day after announcing a $130 billion deal to buy out Vodafone’s 45-percent stake in the two companies’ Verizon Wireless joint venture. Vodafone dropped 2.5 percent.

Microsoft, another Dow component, dropped 4.4 percent after announcing a $7.2 billion deal to acquire Nokia’s mobile phone unit. U.S.-traded shares of Nokia soared 36.9 percent.

CBS jumped 4.9 percent after resolving a contract dispute with Time Warner that had led to a programming blackout in New York City and some other markets. Time Warner rose 1.7 percent.

Bank of America, also a Dow member, rose 1.8 percent on reports that it is selling its shares in China Construction Bank for about $1.5 billion.

Other large banks also advanced, including Citigroup (up 2.9 percent) and JPMorgan Chase (up 2.1 percent).

Technology shares were strong, led by Apple (up 1.9 percent), Amazon (up 2.6 percent), Google (up 2.0 percent) and Cisco (up 1.5 percent).

Bond prices fell. The yield on the 10-year Treasury jumped to 2.84 percent from 2.75 percent Friday, while the 30-year rose 3.78 percent from 3.68 percent. Prices and yields move inversely.

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