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Stocks power higher after a dreadful week; Dow jumps 450

By The Associated Press
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NEW YORK (AP) — Stocks are powering higher Monday, sending the Dow Jones industrial average up more than 450 points, as the market claws back some of its massive losses last week, when it slumped into a "correction" for the first time in two years. Technology companies and banks, some of the biggest winners on the market over the past year, are up the most.

KEEPING SCORE: The Standard & Poor's 500, the benchmark for many index funds, gained 42 points, or 1.6 percent, to 2,661 as of 3:40 p.m. Eastern time. The Dow was up 471 points, or 2 percent, to 24,662. It had risen as much as 574 earlier, led by big gains for Boeing and Apple.

The Nasdaq composite climbed 122 points, or 1.8 percent, to 6,997. The Russell 2000 index of smaller-company stocks advanced 16 points, or 1.1 percent, to 1,494.

It took just nine days for stocks to plunge 10 percent from their latest peak, which was reached on January 26. A drop of that size is known on Wall Street as a market "correction." According to LPL Financial, it was the swiftest move from a record high to a correction in the history of the S&P 500. The index rose 1.5 percent Friday but still wound up with its worst weekly loss in more than two years.

Despite the two-day recovery, the S&P 500 is down 7.4 percent from its record high, and investors expect far more volatility in the stock market than they did two weeks ago.

GAINERS: Technology companies rose. They have slumped recently after winning a big portion of the market's gains over the last year. Apple gained $6.69, or 4.3 percent, to $163.10 while Cisco Systems rose $1.16, or 2.9 percent, to $40.69. Chipmakers Broadcom and Qualcomm each climbed after CNBC reported that the companies will meet this week to discuss Broadcom's $121 billion offer to buy Qualcomm.

Retailers, apparel makers and other companies that focus on consumers made some of the largest gains. They held up relatively well during the steep downturn over the last two weeks, a sign that investors expect shoppers to keep spending and the economy to keep growing. Netflix climbed $8.57, or 3.4 percent, to $257.98. It's up 34 percent since the beginning of the year.

Restaurant Brands International, the owner of Burger King and Tim Hortons, jumped $3.50, or 6.2 percent, to $60.02 after a strong fourth-quarter report, and McDonald's gained $3.77, or 2.3 percent, to $164.57.

THE QUOTE: Jim Paulsen, chief investment strategist for the Leuthold Group, said he thinks stock and bond prices will fall further as investors consider the likelihood that interest rates will keep rising and inflation will increase: inflation and higher wages can cut into company profits, and higher interest rates slow down economic growth.

"The catalyst behind this bull market up until maybe the last year or so has just been the ability of this economy to grow, even if it's very sluggishly (...) without creating any negative consequences for the financial markets," he said.

Paulsen said the consumer prices report Wednesday or the February employment report due next month could both have major effects on the market.

ENERGY: Benchmark U.S. crude gained 9 cents to $59.29 a barrel in New York. Brent crude, used to price international oils, lost 20 cents to $62.59 a barrel in London.

Oil prices have dropped since reaching long-time highs in late January, when U.S. crude peaked at $66 a barrel. The S&P 500 energy index is down 12 percent over the last month.

Wholesale gasoline fell 2 cents to $1.68 a gallon. Heating oil fell 2 cents to $1.84 a gallon. Natural gas slid 3 cents to $2.55 per 1,000 cubic feet.

DEFENSE DEAL: Defense contractor General Dynamics will spend almost $7 billion to acquire internet technology company CSRA. The Trump administration has been pushing defense spending aggressively higher. CSRA climbed $9.62, or 31.2 percent, to $40.44 Monday. General Dynamics lost $1.44 to $210.66.

FOX HUNT? Twenty-First Century Fox picked up 69 cents, or 1.9 percent, to $36.42 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. Disney agreed to buy Fox's movie and television studios and some cable and international TV businesses in December for about $52.4 billion in stock. Comcast also reportedly had talks with Fox.

Comcast stock rose 1 cent to $38.58 while Disney added 35 cents to $103.44.

BONDS: Bond prices edged higher. The yield on the 10-year Treasury note stayed at 2.86 percent.

CURRENCIES: The dollar rose to 108.67 yen from 108.53 yen. The euro rose to $1.2284 from $1.2231.

METALS: Gold rose $10.70 to $1,326.40 an ounce. Silver jumped 43 cents, or 2.7 percent, to $16.57 an ounce. Copper added 5 cents, or 1.7 percent, to $3.09 a pound.

OVERSEAS: Germany's DAX jumped 1.4 percent while the CAC 40 in France and the British FTSE 100 both advanced 1.2 percent.

Hong Kong's Hang Seng lost 0.2 percent and Seoul's Kospi rose 0.9 percent. Markets in Japan were closed for a holiday.

____

AP Markets Writer Marley Jay can be reached at http://twitter.com/MarleyJayAP . His work can be found at https://apnews.com/search/marley%20jayt .

  • Associated Categories: Associated Press (AP), AP National News, AP Online National News, AP Business, AP Business - Economy, AP Business - Financial Markets, AP Business - Industries, AP Business - Utilities
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