Stocks on Wall Street have rebounded from a rough January as improving manufacturing activity and better-than-expected earnings from Exxon Mobil lifted sentiment.
Economic data showed a further rise in consumer spending, which helped alleviate some recent economic worries. The US Commerce Department reported that personal income climbed by 0.4% in December while personal spending rose by 0.2%, the third monthly increase.
Wall Street ended one of the worst months in nearly a year on Friday, with all the major benchmarks closing at two-month lows.
President Obama's plan to restrict trading at big banks, China's bank lending curbs and global debt worries all rattled investors. But investors have used the selloff as an opportunity to get back into stocks.
Aluminum giant Alcoa led the rise in blue chip shares, rising 3.5%, as metals futures moved higher. Exxon Mobil was also particularly strong, up 2.3% after the energy giant reported fourth-quarter earnings above analysts' estimates.
Just four of the Dow's 30 components were in the red, led by Microsoft, which slipped 0.4%. The Dow Jones Industrial Average closed 118.20 points, or 1.2%, at 10,185.53.
The S&P 500-share index climbed 1.4% to 1089.18, with all of its sectors in the black, led by the energy and materials sectors. The technology-heavy Nasdaq Composite was up 1.4% to 2171.20.
World markets mixed
European stock markets finished mixed as traders awaited key economic and corporate data scheduled for release this week.
In London, utilities stocks were higher on mergers speculation in the UK water sector. Northumbrian shares jumped 11% while Severn Trent jumped 4.1%.
The FTSE edged into positive territory, rising 0.3% to 5202 after UK manufacturing data came in much stronger than expected for January.
Germany's DAX traded 0.2% higher at 5617.02 and Paris's CAC-40 fell 0.1% to 3734.92.
The pan-European Stoxx 600 Index was down 0.2% at 246.46.
Asian markets were also mixed. Hong Kong's Hang Seng Index added 0.6% to 20243.75, Japan's Nikkei Stock Average of 225 companies rose 0.1% to 10205.02 and South Korea's Kospi advanced 0.3% to 1606.44.
Going in the other direction, China's Shanghai Composite dropped 1.6% to 2941.36, Australia's S&P/ASX 200 shed 1% to 4524.1 and Taiwan's Taiex fell 1.5% to 7524.67.
Commodities: Oil, gold up
Crude oil futures rose on positive US economic data and some buoyant corporate earnings.
Oil extended its gains after a report that the Institute of Supply Management's January manufacturing index rose to its highest level since April 2006. It rose to 58.4, compared with 54.9 in December and more than economist expectations of 55.3.
Light, sweet crude for March delivery gained 85USc to $US73.74 a barrel in New York Mercantile. Brent crude on the ICE futures exchange also traded 85USc higher at $US72.31 a barrel.
Gold futures rose as some participants re-entered the market in search of bargains after the metal lost ground for the past two months.
February gold is up $US10.70, or 1%, at $US1093.70 an ounce in New York. April gold is up $US5.70, or 0.5%, at $US1089.50 after losing 8.4% over the past two months.
Currencies: Dollar down, euro up
The US dollar was lower against the euro but it pared its losses after better-than-expected U.S. manufacturing data.
The news boosted the dollar against the yen and pushed down the euro to threaten a break below the $US1.39 mark.
The euro remained slightly higher on the day, after an earlier jump driven by strong euro-zone manufacturing data.
The UK pound failed to benefit from the strongest UK manufacturing data reported in more than 15 years. Traders sold off sterling over uncertainty about whether the Bank of England would end the bond-buying programme.
The euro was up slightly at $US1.3904 from $US1.3863 late on Friday. The dollar was at ¥90.89 from ¥90.25, while the euro was at ¥126.37 from ¥125.12.
The UK pound slid to $US1.5923 from $US1.5982.
Tue, 02 Feb 2010