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US stocks surge as US strikes jihadists in Iraq

Wall Street stocks pushed higher on Friday (Aug 8) despite US air strikes in Iraq as investors ramped up buying in a market that some analysts said had been oversold.

NEW YORK: Wall Street stocks pushed higher on Friday (Aug 8) despite US air strikes in Iraq as investors ramped up buying in a market that some analysts said had been oversold.

The Dow Jones Industrial Average jumped 185.66 points (1.13 per cent) to 16,553.93. The broad-based S&P 500 gained 22.02 (1.15 per cent) to 1,931.59, while the tech-rich Nasdaq Composite Index bolted 35.93 (0.83 per cent) higher to 4,370.90.

"Today is a bounce," said Tom Cahill, a portfolio strategist at Ventura Wealth Management. "It was just so oversold in the short-term, it makes a lot of sense it would bounce."

Heading into Friday's trade, US stocks had been lower for the week as investors digested a worsening in tensions over Ukraine and a sharp increase in violence in Iraq that prompted the first US air strikes since 2011.

"This market continues to shrug off concerns and negativity," said Michale James, managing director of equity trading at Wedbush Securities.

Dow member McDonald's rose 0.3 per cent after it said July global comparable sales dropped 2.5 per cent, with sales in Asia sinking 7.3 per cent following a report that it was using unsafe meat in China.

Amazon gained 1.7 per cent as a group of more than 900 authors called on the online retailer to end a dispute with publisher Hachette over book pricing. The authors said they were "not taking sides" in the dispute but that Amazon should not take actions that hurt writers, as it has with Hachette authors.

Tekmira Pharmaceuticals surged 45.1 per cent higher after US officials loosened restrictions on the use of its experimental drug to treat the Ebola virus.

Gap jumped 5.9 per cent as July sales rose 2 per cent. The retailer projected second-quarter earnings of 73-74 cents per share, well above the 66 cent analyst forecast.

Social games developer Zynga fell 1.4 per cent after it reported a US$62.5 million second quarter loss, compared to a loss of US$15.8 million a year ago.

Bond prices were unchanged. The yield on the 10-year US Treasury held steady at 2.42 per cent, while the 30-year traded at 3.23 per cent, the same level as Thursday. Bond prices and yields move inversely.

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