Wall Street ends with solid gains; investors hail U.S. debt-ceiling truce
Reuters
Published Oct 07, 2021 06:49AM ET
Updated Oct 07, 2021 10:42PM ET
By Noel Randewich, Lewis Krauskopf and Devik Jain
(Reuters) - Wall Street ended sharply higher on Thursday in a broad-based rally led by Big Tech, as a truce in the debt-ceiling standoff in the U.S. Congress relieved concerns of a possible government debt default this month.
Mega-cap stocks jumped with Apple Inc (NASDAQ:AAPL) up 0.9% and Amazon.com Inc (NASDAQ:AMZN) rising 1.2%, the biggest boosts to the S&P 500 and Nasdaq. Tesla (NASDAQ:TSLA) and Google-parent Alphabet (NASDAQ:GOOGL) both rose more than 1%.
The U.S. Senate took a step toward passing a $480 billion increase in Treasury Department borrowing authority, which would put off another partisan showdown until December.
Uncertainty over the debt-ceiling negotiations was one concern investors cited in September as the S&P 500 logged its biggest monthly percentage drop since the onset of the coronavirus pandemic in March 2020.
"Today's (market) is driven by a slight move in Washington towards rationality about being able to pay their bills, write some checks," said Kim Forrest, chief investment officer at Bokeh Capital Partners in Pittsburgh.
Meanwhile, data showed the number of Americans filing new claims for jobless benefits dropped last week by the most in three months, suggesting the labor market recovery was regaining momentum as the latest wave of COVID-19 infections began to subside.
The closely watched monthly U.S. jobs report is due on Friday.
“Today’s numbers reinforce the expectation that employment will take a significant step up in the coming months, and I think that’s positive for the economy,” said Brad Neuman, director of market strategy at Alger.
"The market climbed its wall of worry today as fears of a debt-ceiling impasse receded and hopes for an acceleration in employment gains were reinforced.”
The Dow Jones Industrial Average rose 0.98% to end at 34,754.94 points, while the S&P 500 gained 0.83% to 4,399.76.
The Nasdaq Composite climbed 1.05% to 14,654.02.
The S&P 500 materials index jumped 1.35% and the consumer discretionary index rallied 1.50%, both leading among 11 sectors.
U.S.-traded Chinese stocks Alibaba (NYSE:BABA) Group Holding and Tencent Holdings (OTC:TCEHY) each surged about 8% as concerns around U.S.-Sino trade relations and Evergrande's debt crisis appeared to ease.
Investors will watch third-quarter earnings reports that start to arrive in earnest next week. Analysts on average estimate S&P 500 companies' earnings per share rose 29% in the third quarter, according to Refinitiv.
Levi Strauss & Co (NYSE:LEVI) shares jumped 8.5% after the jeans maker beat third-quarter revenue and profit estimates.
Get The News You Want
Volume on U.S. exchanges was 10.1 billion shares, compared with the 11 billion average over the last 20 trading days.
Advancing issues outnumbered declining ones on the NYSE by a 2.50-to-1 ratio; on Nasdaq, a 2.49-to-1 ratio favored advancers.
The S&P 500 posted 31 new 52-week highs and four new lows; the Nasdaq Composite recorded 93 new highs and 80 new lows.
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.