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Overnight Markets: Wall Street surges as Irma loses force

Insurers climbed as investors anticipated they won’t have to pay out as much in claims as it looked like they would just a few days ago.

 
Overnight Markets: Wall Street surges as Irma loses force

Wall Street surged to record highs on Monday after hurricane Irma weakened to a tropical storm, without causing as much damage as many had feared.

The Dow Jones industrial average added 256 points, or 1.2%, to 22,055, its biggest one-day jump since March. The Nasdaq composite jumped 72 points, or 1.1%, to 6,432. The Standard & Poor's 500 index rose 27 points, or 1.1%, to close 2,488, a record.

Irma, once ranked as one of the most powerful hurricane recorded in the Atlantic, was downgraded to a tropical storm on Monday morning, but still caused severe flooding in many Florida cities and knocked out power to about 5.8 million homes and businesses.

insurers climbed yesterday as investors anticipated they won’t have to pay out as much in claims as it looked like they would just a few days ago.

HCI Group jumped 17.5% while Heritage Insurance gained 21.6%. Larger insurers also rallied. Reinsurance company XL Group advanced 5% and Travelers gained 2.3%.

Investors also expected that travel-related companies won’t take such a big hit from the storm. Royal Caribbean Cruises jumped 3.6% and American Airlines gained 5.2%. Travel booking site Priceline rose 1.6%.

Global investors were also relieved after a North Korean national holiday passed without any other actions that would raise tensions between that country and the US.

Banks rose, as JP Morgan Chase gained 1.5% and Fifth Third Bancorp added 2.4%.

In another sign investors were willing to take more risks, gold lost $15.50, or 1.1%, to $1,335.70 an ounce. Wholesale gasoline lost 1 cent to $1.63 a gallon.

In Asia, shares were trading mostly higher on Tuesday in morning session, following a firm lead from Wall Street as concerns faded over the potential damage of Irma.

Japan's Nikkei 225 rose 1%. Across the Korean Strait, the Kospi gained 0.22%. Down Under, the S&P/ASX 200 tacked on 0.73%. The Hang Seng Index, meanwhile, shed 0.08%. The Shanghai Composite trading higher by 0.03% and the Shenzhen Composite was off by 0.01%.

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