U.S. stocks soared on Tuesday, boosted by a surprising jump in the consumer confidence in May and a strong rally in the technology sector.
 |
|
Traders work on the floor of the New York Stock Exchange, May 26, 2009. [Xinhua/Reuters photo]
|
Dow Jones added nearly 200 points, and Nasdaq rallied three percent.
Wall Street initially opened lower on Tuesday as a nuclear test conducted by the Democratic People's Republic of Korea (DPRK) rattled investors. Market sentiment was lifted by the upbeat news in the improvement of consumer confidence, as consumer spending accounts for more than two thirds of U.S. economic activity.
The New York-Based private research organization Conference Board said Tuesday that its Consumer Confidence Index jumped from 40.8 in April to 54.9 in May, much better than economists had expected. Current reading marks the highest level since September when the level was 61.4, and it is moving closer to the year-ago level of 58.1.
Technology shares rallied after Morgan Stanley upgraded Apple Inc.'s rating to the equivalent of a buy, citing the long-term potential of its popular iPhone. Shares of Apple were up 6.76 percent to 130.78 dollars. Its rival in smartphone market ResearchIn Motion Limited rose 6.55 percent.
Home builder stocks gained as investors largely shrugged off lackluster readings from the housing market. The S&P/Case-Shiller home price index dropped 18.7 percent in March and tumbled by 19.1 percent in the first quarter, the most in 21 years.
The market also focused on General Motor Corp. as the June 1 deadline for the company to restructure approaches. GM won a union agreement to cut the payment of stock to a United Auto Workers health-care trust by 55 percent, giving the largest U.S. automaker more equity to spread among creditors. GM shares added 1 cent to 1.44 dollars after fluctuating widely between 1.12 dollars and 1.84 dollars.
The Dow Jones industrial average rose 196.17, or 2.37 percent, to 8,473.49. The Standard & Poor's 500 index gained 23.33, or 2.63percent, to 910.33, and the Nasdaq composite index rallied 58.42, or 3.45 percent, to 1,750.43.
(Xinhua News Agency May 27, 2009)
