CHINA also boosted Wall Street yesterday as shares ended sharply higher, also buoyed by investors snapping up technology stocks on cautious optimism over upcoming earnings reports.
The Dow Jones industrial average rose 208.63 points, or 1.17 per cent, to end at 18,034.93. The S&P 500 gained 19.22 points, or 0.92 per cent, to 2,100.4, and the Nasdaq Composite added 62.79 points, or 1.27 per cent, to 4,994.60.
In the second industry-wide cut in two months, China’s central bank on Sunday reduced the amount of cash that banks must hold as reserves in a move to help spur lending and combat slowing economic growth. The move is thought to have had a knock-on effect by increasing investor confidence.
A 2.28 per cent rise in Apple shares led the US market higher, along with a 3.42 per cent jump in IBM. The IT component of the S&P 500 closed up 1.79 per cent.
Other corporations reporting earnings this week include major technology names Facebook, Google, Qualcomm, Microsoft and Amazon.com.
The outlook for technology companies’ profits has brightened modestly following results from Intel and Netflix last week.
“People are thinking we’ve had three major tech companies do well, so maybe the others will do well also,” said Donald Selkin, chief market strategist at National Securities in New York.
Selkin added: “The danger is that when stocks rally ahead of an event, the bar gets set higher and it sets things up for disappointments.”