Stocks move higher, extending rallyNEW YORK (AP) — Stocks rose in morning trading Tuesday as investors built further momentum amid fresh signs the global economy is recovering.
NEW YORK (AP) — Stocks rose in morning trading Tuesday as investors built further momentum amid fresh signs the global economy is recovering.
Overseas markets rallied as Australia’s central bank became the first major central bank to boost interest rates.
The rate increase added to beliefs that world governments are expecting a global economic recovery soon. Australia’s central bank governor said it was time to begin reducing stimulus provided by low interest rates and that the risk of major economic contraction in the country was over.
With little in the way of new economic reports Tuesday, investors are extending Monday’s gains. U.S. stock markets rebounded from two consecutive losing weeks after a report showed the service sector grew for the first time in more than a year and amid upbeat comments about the nation’s largest banks.
In the first half-hour of trading, the Dow Jones industrial average rose 102.25, or 1.1 percent, to 9,702.00. The Standard & Poor’s 500 index rose 11.91, or 1.1 percent, to 1,052.37, while the Nasdaq composite index rose 20.79, or 1 percent, to 2,088.94.
Metals and mining and energy stocks were rising early in trading as gold and oil prices both rose sharply. Gold touched an all-time high of $1,038 an ounce earlier Tuesday.
Tuesday’s gains followed a strong Monday that was supported by a better-than-expected reading on the service sector. The Institute for Supply Management said its service index, which tracks more than 80 percent of the country’s economic activity, rose to 50.9 in September from 48.4 in August. It was the first reading above 50, which indicates growth, since August 2008. Economists were expecting a reading of 50.
Investors had been selling off stocks for the past two weeks as economic reports failed to meet expectations, indicating an economic rebound could be slow and uneven. It was the first two-week stretch of declines since July.
The Dow jumped 1.2 percent Monday, while the S&P surged 1.5 percent.