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Overnight Markets: US stocks rebound as shutdown seen short-lived
by Himanshu Singh on Oct 02, 2013 at 04:12
Wall Street kicked off a new month and a new quarter with gains on Tuesday as investors speculated that the economic effects of the first partial government shutdown in 17 years would be limited.
The Dow Jones industrial average was up 62 points, or 0.41%, at 15,192. The Standard & Poor's 500 Index was up 13 points, or 0.80%, at 1,695. The Nasdaq Composite Index was up 47 points, or 1.23%, at 3,818.
Shares rebounded after declining in seven out of the past eight sessions on concerns about a possible shutdown as investors viewed the pullback as a buying opportunity in the absence of an extended shutdown. Congress missed a midnight deadline to agree on a spending bill, resulting in up to 1 million workers being put on unpaid leave.
Congress also faces a dispute over raising the $16.7 trillion debt ceiling this month. The Treasury has said measures to avoid exceeding the borrowing limit will be exhausted on 17 October.
In the latest economic data, the Institute for Supply Management's manufacturing index came in at 56.2, up from the previous month and above expectations for a reading of 55.
Shares of Apple Inc (AAPL.O) gained 2.4% on news that billionaire activist investor Carl Icahn "pushed hard" for a share buyback when he had dinner with Apple chief executive Tim Cook on Monday.
Merck & Co (MRK.N) rose 2.4% after it announced a plan to cut annual operating costs by $2.5 billion by the end of 2015 and eliminate 8,500 jobs.
WellPoint Inc. added 3% to pace gains among health-care providers as open enrollment for the new exchanges mandated by the Affordable Care Act began today.
Walgreen Co. (WAG) climbed 4.5% as profit rose 86% after its customer-loyalty card boosted sales. Under Armour Inc. increased 4.1% as JP Morgan Chase & Co. upgraded the maker of workout clothing.
In Asia, shares rose on Wednesday in late morning trade as investors speculated economic effects would be limited from the first partial US government shutdown in 17 years.
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