Wall Street climbs as Ukraine worries easeComment on this story
New York - US stocks climbed on Monday, with the S&P 500 bouncing from its worst weekly drop in the past seven, as concerns eased over the situation in Crimea, while economic data indicated the economy was improving after a winter slowdown.
The 97-percent vote in Crimea in favour of quitting Ukraine was condemned as illegal by Kiev and the West, but the referendum passed without violence.
In response, the United States and European Union imposed personal sanctions on Russian and Crimean officials involved in the seizure of Crimea. Russian President Vladimir Putin signed a decree recognising the region as a sovereign state.
The geopolitical tension had weighed on equities last week, with the S&P 500 falling 2 percent and the CBOE Volatility index jumping to its highest since early February on Friday.
Economically-sensitive sectors led the way higher on Monday, with both technology and industrials up 1.3 percent. Google gained 1.6 percent to $1,192.10 while General Electric rose 1.3 percent to $25.43.
“It's sort of a relief rally there was no real negative surprise (in Ukraine). What happened was what was expected,” said Terry Morris, senior vice president and senior equity manager for National Penn Investors Trust Company in Reading, Pennsylvania.
The advance continued a recent trend of investors using market pullbacks as buying opportunities. Major indexes have not undergone a sustained pullback in more than a year.
The Dow Jones industrial average rose 181.55 points or 1.13 percent, to 16,247.22, the S&P 500 gained 17.7 points or 0.96 percent, to 1,858.83 and the Nasdaq Composite added 34.552 points or 0.81 percent, to 4,279.949.
The US Federal Reserve's massive stimulus has helped keep a floor under equity prices, and market participants are looking ahead to a two-day meeting of the Fed's policy-setting committee, which begins on Tuesday.
In the latest economic data, manufacturing output recorded its largest increase in six months in February and factory activity in New York state expanded early this month.
“It looks like maybe we are thawing out a little bit in terms of the economic indicators. The market has got it right, you don't have to be a rocket scientist or a weatherman to figure out it's been a tough winter,” said Doug Foreman, co-chief investment officer of Kayne Anderson Rudnick Investment Management in Los Angeles.
In company news, Chinese e-commerce giant Alibaba Group Holding Ltd said on Sunday it would begin the process toward a US initial public offering, ending months of speculation. Shares of Yahoo, which has a 24-percent stake in the company, jumped 4 percent to $39.11, one of the best performers on the benchmark S&P index.
JA Solar Holdings shares advanced 2.1 percent to $11.66 after the company posted its first profit in 10 quarters and forecast higher shipments for the year.
Giant Investment Ltd will acquire Chinese online gaming company Giant Interactive Group for $3 billion and take it private, the companies said on Sunday. Shares of Giant rose 1.7 percent to $11.59.
Intercept Pharmaceuticals dropped 11.9 to $407.16. The company said a trial showed patients taking its experimental liver disease drug experienced a higher number of heart-related problems than those given a placebo.
Volume was light, with about 5.21 billion shares traded on US exchanges, well below the 6.87 billion average so far this month, according to data from BATS Global Markets.
Advancing stocks outnumbered declining ones on the NYSE by 2,182 to 818, while on the Nasdaq, advancers beat decliners 1,669 to 936. - Reuters