Dow Jones: 12,068.46 (+85.22) Nasdaq: 2,695.25 (+9.10) SP 500: 1,261.12 (+7.89)US STOCKS rose yesterday as the European Central Bank's Juergen Stark said the region's debt crisis will be under control in two years.
Mr Stark’s comments “suggest that a cure can be found to remedy the peripherals’ fiscal issues”, Mark Luschini, chief investment strategist at Philadelphia-based Janney Montgomery Scott, said. “With things trading off of Europe, that is all it takes.”
The Dow Jones industrial average was up 85.22 points, or 0.71 per cent, at 12,068.46.
The Standard & Poor’s 500 Index rose 7.89 points, or 0.63 per cent, at 1,261.12.
The Nasdaq Composite Index advanced 9.10 points, or 0.34 per cent, at 2,695.25.
Italian 10-year borrowing costs surged to a euro-era record amid concern the region’s third-largest economy is struggling to manage its debt loads, while growth in Europe is faltering. Investors are betting prime minister Silvio Berlusconi may be forced to resign if he fails to win majority support in today’s vote on the 2010 budget report.
Mr Stark, a member of the ECB’s executive board, speaking at an event in Lucerne, Switzerland, said the debt crisis may be under control within two years to the point there will be “no need for further political actions . . . It’s a little bit of a risk reversal”, Larry Peruzzi, senior equity trader at Cabrera Capital Markets in Boston, wrote in an e-mail.
Some of the biggest companies rose yesterday. Home Depot increased 2.8 per cent to $37.40. Hewlett-Packard gained 3.3 per cent to $27.86.
Amgen rallied 6.1 per cent to $58.51. The stock repurchase plan, amounting to about 10 per cent of the company, is part of a current $10 billion buyback program, Amgen said. The drugmaker will raise debt to help fund it.
Dish Network, the second-largest US satellite-TV provider, gained 5.3 per cent to $24.72, after awarding a special dividend that allayed investors’ concerns the company will invest billions in a wireless network.
Jefferies added 1.6 per cent to $12.26. The New York-based firm cut gross holdings in sovereign securities of Portugal, Italy, Ireland, Greece and Spain by almost 50 per cent since last week’s close of trading, to show how easily it can reduce funds at risk. – (Bloomberg/Reuters)