Citywire printed articles sponsored by:
View the article online at http://citywire.co.uk/wealth-manager/article/a703510
Overnight Markets: Wall Street inches higher on Summers' withdrawal
by Himanshu Singh on Sep 17, 2013 at 04:39
US stocks gained on Monday after former Treasury Secretary Lawrence Summers withdrew as a candidate for Federal Reserve chairman and tensions over dealing with Syria’s chemical weapons eased.
The Dow Jones industrial average rose 119 points or 0.77%, to 15,495, the S&P 500 gained 10 points or 0.57%, to 1,698, and the Nasdaq Composite dropped four points or 0.12%, to 3,718.
Investors cheered Summers' decision, as the move likely means an easier path for the eventual nominee for Fed chief. Summers was regarded as more eager to scale back the Fed's $85 billion a month bond buying than the new front-runner, Fed Vice-Chairwoman Janet Yellen.
However, early enthusiasm faded after President Barack Obama stood firm in warning Republicans in Congress he will not negotiate over an extension of the US debt ceiling as part of a budget fight.
Economic report showed US industrial production rose in August as a bounce-back in motor vehicle assembly lifted manufacturing output. Separately, the pace of growth in New York state's manufacturing sector unexpectedly slowed this month, but firms' outlook brightened.
Housing stocks surged after traders bet on downward pressure on mortgage rates. D.R. Horton (DHI.N) rose 3.7%.
In deal news, Packaging Corp of America (PKG.N) said it would acquire smaller rival Boise Inc (BZ.N) for about $1.28 billion to boost its container board capacity. Packaging Corp of America shares jumped 10.8% and Boise rallied 26.1%.
Boeing Co. (BA) rallied 3.9% to pace gains among industrial shares after Sterne Agee & Leach Inc. raised its price target. Delta Air Lines Inc. jumped 3%.
Bristol-Myers Squibb Co. added 3.6% after JP Morgan Chase & Co. advised investors to buy the shares.
Financial shares also rallied with Wells Fargo & Co., the biggest US home lender, climbed 1.7%. Travelers Cos. gained 1.2%.
News sponsored by: