Stocks climb after two- day slump
NEW YORK — U. S . stocks rebounded Tuesday and climbed after a survey showed consumer confidence is at a nine- year high, a sign Americans will keep spending. Technology and consumer stocks made the largest gains.
The Dow Jones industrial average jumped 133.47 points, or 0.7 percent, to 18,228.30. The Standard & Poor’s 500 index picked up 13.83 points, or 0.6 percent, to 2,159.93. The Nasdaq composite gained 48.22 points, or 0.9 percent, to 5,305.71.
The market opened lower after two days of losses but quickly recovered. The consumerconfidence report fueled rises in major indexes and they locked in a big gain by early afternoon.
Technology companies jumped, and solid results from cruise line operator Carnival sent travel- related companies higher. Energy companies slumped with oil prices as hopes for an international cut in fuel production faded.
U. S. consumer confidence reached its highest level this month since August 2007, according to the Conference Board. The group said its index rose to 104.1 as consumers grew more optimistic about the labor market. The result was better than expected.
Katie Nixon, chief investment officer for Northern Trust, said consumer spending is even more important right now because government spending, exports, and capital spending by businesses are all limited.
“Everything’s riding on the consumer right now,” she said. Recently investors have worried about consumer spending because of disappointing auto sales and retail sales.
Travel companies made some of the biggest gains on the S& P 500 after cruise operator Carnival reported a solid profit and strong revenue in the third quarter and raised its forecast for its full- year results. Carnival rose $ 1.88, or 4 percent, to $ 48.35 while competitor Royal Caribbean added $ 3.38, or 4.8 percent, to $ 74.35.
Shares of Amazon rose $ 16.95, or 2.1 percent, to $ 816.11 as consumer stocks made big moves. Netflix, which has slumped this year after its stock doubled in 2015, regained $ 2.51, or 2.7 percent, to $ 97.07.
U. S. crude fell $ 1.26, or 2.7 percent, to $ 44.67 a barrel in New York. The international standard, Brent crude, lost $ 1.38, or 2.9 percent, to $ 45.97 a barrel in London. Oil prices rose 3 percent on Monday. Devon Energy lost $ 1.26, or 3.2 percent, to $ 38.38 and ConocoPhillips sank 59 cents, or 1.5 percent, to $ 39.43.
American Express gained 86 cents, or 1.4 percent, to $ 64.28. A federal appeals court ruled late Monday that the company didn’t violate antitrust laws by preventing stores from asking customers to use one credit card over another and steering consumers to another type of payment. On Tuesday, the company said it will buy back as much as 150 million shares of its stock and raised its dividend to 32 cents from 29 cents.
Bond prices continued to rise. The yield on the 10- year Treasury note fell to 1.56 percent from 1.58 percent. Bond yields have been slipping for more than a week as investors waited for the Federal Reserve to make a decision on interest rates. Last Wednesday the Fed announced that it was leaving rates where they are for now.