Bare-bones EU debt deal news enough for buyers
NEW YORK (Reuters) - Stocks rose on Wednesday as the slow progress from European leaders in resolving their debt crisis was enough to satisfy investors, even if early reports from an EU summit were short on detail.
The euro zone aims to leverage its 440 billion euro bailout fund "several fold," but details are not expected until November, according to a draft statement obtained by Reuters.
European leaders agreed on Wednesday to force banks to raise more capital by June next year, to protect against losses from any Greek debt restructuring and to try to contain the region's financial crisis.
Stocks increased gains in the afternoon as the news emerged, continuing the market's recent rally. The S&P has risen 9.5 percent for the month on growing optimism for a deal to address sovereign debt and bank balance sheets in Europe.
"The market has begun to discount any meaningful announcement coming from today's meeting -- that should be helpful for the markets as the bar is set pretty low," said Joseph Tanious, market strategist at J.P. Morgan Funds in New York.
The Dow Jones industrial average .DJI gained 162.42 points, or 1.39 percent, to 11,869.04. The Standard & Poor's 500 Index .SPX.INX rose 12.94 points, or 1.05 percent, to 1,241.99. The Nasdaq Composite Index .IXIC added 12.25 points, or 0.46 percent, to 2,650.67.
Financials were among the best performers with JPMorgan Chase & Co (JPM.N) up 2.1 percent to $34.18 and U.S. Bancorp (USB.N) up 2.6 percent to $25.48. The KBW Bank index .BKX advanced 2.1 percent.
Tanious said details still need to be worked out, including what to do about Greece's overhang of debt.
Gains were curbed on the Nasdaq as Amazon.com Inc (AMZN.O) slumped 12.7 percent to $198.401 a day after forecasting a disappointing outlook for the current quarter on costs related to Kindle and other investments.
On the Dow, Boeing Co (BA.N) rose 4.5 percent to $66.56 as the top boost to the index after raising its outlook.
Visa Inc (V.N) shed 2.1 percent to $90.10 in extended trade after the San Francisco-based card processor posted fourth-quarter earnings.
With Europe dominating headlines, earnings have taken a back seat. According to Thomson Reuters data, of the 206 companies in the S&P 500 that have reported earnings for the quarter, 72 percent have topped Wall Street estimates.
Economic data showed demand for a range of long-lasting U.S.-made goods rising at the fastest pace in six months in September and new homes sales for the same period the strongest in five months.
Volume was solid with about 8.54 billion shares traded on the New York Stock Exchange, NYSE Amex and Nasdaq, above the daily average of 8.01 billion.
Advancing stocks outnumbered declining ones on the NYSE by 2,404 to 598, while on the Nasdaq, advancers beat decliners 1,817 to 675.
(Editing by Kenneth Barry)
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Reuters looks at the life and times of Nelson Mandela, an icon of peace and reconciliation who came to embody the struggle for justice around the world. Video