US Market Recap
Stocks skyrocketed right out of the gate this morning, as the Street interpreted upbeat economic data as a surefire sign of healing. In the U.S., the Institute for Supply Management's (ISM) index of national manufacturing activity rose to 48.9 in July, marking its highest level in nearly a year. What's more, the data showed that construction spending rose 0.3% in June, exceeding economists' predictions for a 0.5% decline. The encouraging figures echoed those from across the pond and in the Far East, as the euro zone factory Purchasing Managers' Index (PMI) was revised higher in July, and manufacturing growth in China hit a 12-month high.
In the equities market, stronger-than-expected earnings reports from the banking sector bolstered the bulls, with financial firms HSBC Holdings (HBC) and Barclays (BCS) leading the pack. Meanwhile, Ford Motor Co. (F) touched a fresh 52-week peak after the automaker reported its first year-over-year sales increase in nearly two years. By the close, the major market indices tagged new year-to-date highs, with both the S&P 500 Index (SPX) and Nasdaq Composite (COMP) powering past psychologically significant round-number resistance.
The Dow Jones Industrial Average (DJIA – 9,289.56) rallied to triple-digit gains within the first hour of trading today, eventually settling on a gain of 115 points, or 1.3%. Only four of the Dow's 30 blue chips bucked the trend higher, led by Kraft (KFT) and Coca-Cola Co. (KO). Pacing the advancing issues were Alcoa (AA) , Travelers (TRV), and Bank of America (BAC).
The S&P 500 Index (SPX – 1,002.63) soared 15.2 points, or 1.5%, higher today, muscling past round-number resistance at the 1,000 level for the first time since November 2008. In that same fashion, the Nasdaq Composite (COMP – 2,008.61) added 30.1 points, or 1.5%, by the close, notching its first close atop the 2,000 level since October 2008.
Crude Oil Futures
Crude futures skyrocketed to their highest level in nearly two months today, thanks to upbeat manufacturing data from the U.S. and China. The CLSA Asia Pacific Markets said its China manufacturing Purchasing Managers' Index (PMI) rose to a one-year high of 52.8 in July, compared to 51.8 in June, as manufacturing activity in the country expanded at the fastest pace since May 2008. In addition, a Xinhua newsletter reported that China's crude inventories declined 2.7% in June, marking the first month-over-month pullback in four months. What's more, oil's surge came despite the latest data from the Organization of Petroleum Exporting Countries (OPEC), which indicated that output from the cartel rose slightly in July. By the close, September-dated crude added $21.3, or 3%, to end at $71.58 per barrel.
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