USA stocks end higher after calm session, Dow +1.7%

Chelsea West
February 17, 2018

The moves witnessed in the U.S futures are the result of a solid end Monday when the Dow Jones Industrial average was able to close up over 400 points.

KEEPING SCORE: The Standard & Poor's 500 index gained 21 points, or 0.8 per cent, to 2,641 as of 11:30 a.m.

US stocks ended higher on Monday as the market rebounded after a heavy weekly sell-off. Instead, it was a healthy market correction that is welcomed and long overdue.

All the S&P 500's major 11 sectors rose, though bond-proxy sectors real estate, utilities and telecommunications services underperformed as investors monitored rising interest rates after USA 10-year Treasury yields hit a new four-year high of 2.902 earlier in the day. The Russell 2000 index of smaller-company stocks rose 13.15 points, or 0.9 percent, to 1,490.98.

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"Little has changed in terms of fundamentals", wrote Gaurav Saroliya, director of global macro strategy at Oxford Economics, in a research note on Sunday. It remains down 7.3 percent from a record high on Jan 26 and is now priced at levels first reached in early December. The Trump administration has been pushing defense spending aggressively higher. Cisco Systems rose 2.9 percent and Citigroup climbed 2 percent. General Dynamics slipped $2.57, or 1.2 percent, to 209.53. At the closing bell, the Dow Jones Industrial Average was at 23,858.90, down 4.2 percent. It's still up 15 percent over the past year.

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Restaurant Brands International, the owner of Burger King and Tim Hortons, jumped $3.73, or 6.6 per cent, to $60.24 after a strong fourth-quarter report, and McDonald's gained $2.04, or 1.3 per cent, to $162.84.

Technology companies also rose.

"We think we're going to be volatile for a few more trading days at least, as the market sorts out what's really been going on", Rob Haworth from the U.S. Bank Wealth Management said. The Nasdaq Composite Index was up 107.47 points, or 1.56 percent, to 6,981.96. The Nasdaq climbed 148, or 2.1 percent, to 7,115.

Twenty-First Century Fox picked up 66 cents, or 1.9 percent, to $36.40 after The Wall Street Journal reported that cable and Internet provider Comcast is still interested in buying Fox's entertainment divisions and could make another offer. U.S. crude traded at around $60.14, while Brent futures were around $63.64. "Nevertheless, the worst is likely not over for this week for the simple reason that we have U.S. CPI sitting as a mammoth event risk this week", said Pan, referring to the Wednesday release of U.S. consumer price index data for January.

The S&P 500 is down 9.3 percent from the record high it set January 26. Copper added 5 cents, or 1.7 percent, to $3.09 a pound. Disney agreed to buy Fox's movie and television studios and some cable and worldwide TV businesses in December for about $52.4 billion in stock.

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