US stocks wipe away much of Friday’s losses as everything seems to fall the bulls’ way.
Rising consumer spending and increasing auto sales as well as manufacturing activity hitting its highest level since July 2004 boosts sentiment. The market, which loves M&A, got a big, headline making deal with United and Continental. And what finally seems like a resolution to Greece’s debt woes contributed to the run-up.
Consumer discretionaries among the market’s biggest gainers as the consumer is slowly returning to pre-recession habits. Consumers increased their spending and cut their savings in March, not a good sign for the long-term economy but a positive development for these stocks in the short-term.
DJIA closes up 143, or 1.3%, to 11152, marking its biggest gain since Feb. 16 and fourth largest gain of the year. The index recaptured roughly 90% of Friday’s 159-point drop. Still, this marked the fourth triple-digit move out of the last six sessions, and that kind of volatility doesn’t exactly speak to overriding confidence.
Dow components Caterpillar and Boeing each rise 2.7% and contribute to about 20% of the index’s overall gain. The floats of those two stocks are among the smallest of the 30 in the average, so when the momentum gets cooking, as it did today, it’s easier to see a more pronounced increase (or decrease) in the dollar-value change in those stock prices.
S&P rises 16 to 1202, crossing back above the key 1200 level. Nasdaq Comp jumps 38 to 2499.
(John Shipman and Paul Vigna contributed to this post.)