Thursday, 27 August 2015 02:44
NEW YORK: US stocks surged Wednesday, snapping a six-day losing streak prompted by a big pullback in Chinese equities that has roiled global markets.
The Dow Jones Industrial Average jumped 619.07 points (3.95 percent) to 16,285.51.
The broad-based S&P 500 gained 72.90 (3.90 percent) at 1,940.51, while the tech-rich Nasdaq Composite Index bolted up 191.05 (4.24 percent) to 4,697.54.
All 30 members of the Dow rose, led by Merck with 6.4 percent. Several other companies rose more than five percent, including Apple, JPMorgan Chase, Microsoft, Nike, Visa and ExxonMobil.
US stocks opened sharply higher for the second straight day. However, unlike Tuesday, when a late-afternoon slump pushed the market into the red, US stocks picked up momentum in the afternoon and closed near session highs.
“The market has found its legs,” said Chris Low, chief economist at FTN Financial. “I couldn’t tell you that the low is in place, but I am very comfortable putting my own money to work.”
The S&P 500 shed more than 11 percent of its value in the prior six sessions as worries about the slowing Chinese economy prompted a global sell-off that included an estimated $ 2.7 trillion in losses on Monday alone.
Other major markets were mixed Wednesday, with China’s benchmark stock index down 1.27 percent, Japan’s Nikkei advancing 3.20 percent and indices in Britain, France and Germany falling by more than one percent.
Oilfield equipment maker Cameron International surged 41.1 percent on news it would be acquired by oil services giant Schlumberger for $ 14.8 billion. Schlumberger fell 3.4 percent.
Drilling company Transocean tumbled 4.9 percent after announcing it would suspend its dividend for the next two quarters and that it expects charges of about $ 2.1 billion due to the oil-industry downturn.
US shares of Swiss pesticides giant Syngenta slumped 13.6 percent after Monsanto dropped its campaign to buy the company following rejections. Monsanto jumped 8.6 percent.
Bond prices fell. The yield on the 10-year US Treasury rose to 2.18 percent from 2.09 percent Tuesday, while the 30-year advanced to 2.94 percent from 2.82 percent. Bond prices and yields move inversely.
The retreat in bond prices came amid speculation that China has been selling US treasuries, a possibility raised on Twitter by prominent bond investor Bill Gross of Janus Capital.
