- POSTED: 17 Dec 2013 05:45
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US stocks on Monday jumped following a strong report on US industrial output that came a day before a much-anticipated US Federal Reserve policy meeting.
NEW YORK: US stocks on Monday jumped following a strong report on US industrial output that came a day before a much-anticipated US Federal Reserve policy meeting.
The Dow Jones Industrial Average rose 129.21 points (0.82 per cent) to 15,884.57.
The broad-based S&P 500 gained 11.22 points (0.63 per cent) at 1,786.54, while the tech-rich Nasdaq Composite Index rose 28.54 points (0.71 per cent) to 4,029.52.
US industrial output surged 1.1 per cent in November, the Federal Reserve reported, with manufacturing showing a fourth consecutive monthly gain.
The strong industrial output report came ahead of a two-day meeting of the Fed's monetary policy committee. The Fed will weigh whether the economy is strong enough to cut back its $85 billion a month stimulus program.
Bill Lynch, director of investment at Hinsdale Associates, said stocks were well-positioned for a rally after the S&P 500 lost 1.7 per cent last week.
"Maybe the market used this as an opportunity for investors who are underweight equities to add to their positions," Lynch said.
Insurer AIG advanced 1.1 per cent after announcing the sale of its aircraft leasing unit International Lease Finance Corp. to AerCap of the Netherlands for $5.4 billion.
AerCap surged 33.1 per cent on the announcement, which will see it become the world's largest aviation lease firm.
Semiconductor company Avago Technologies jumped 9.8 per cent after announcing a deal to acquire LSI Corp. for $6.6 billion. LSI rose 38.6 per cent.
Dow component ExxonMobil rose 2.0 per cent after Goldman Sachs upgraded the stock to "buy" from "neutral." Exxon looks "inexpensive" compared to its historic valuation and the company's production outlook has improved, Goldman said.
Google tacked on 1.2 per cent after industry tracker eMarketer said its YouTube unit will garner $5.6 billion in ads this year. Separately, Google bought robot developer Boston Dynamics, according to a person familiar with the matter.
Social media site Twitter fell 4.1 per cent following downgrades from Wells Fargo and SunTrust Robinson Humphries. Wells Fargo said user engagement is not as great as advertisers may desire. SunTrust called the company's valuation "stretched," according to Barrons.com.
Bond prices fell. The yield on the 10-year US Treasury rose to 2.88 per cent from 2.87 per cent, while the 30-year increased to 3.90 per cent from 3.87 per cent. Bond prices and yields move inversely.