tocks rose yesterday on hopes that the Federal Reserve will agree to extend stimulus measures as the economy struggles to recover and the Eurozone’s debt crisis gets worse.
The S&P 500 has gained 7.2 per cent from a five-month intraday low reached on 4 June. The benchmark index closed above its 50-day moving average of 1,346.90 for the first time in seven weeks. But the sharp gains leave the market vulnerable if the outcome of tomorrow’s Fed meeting doesn’t meet market expectations.
Growth-related stocks led the rally, with the S&P materials sector index up two per cent and the financial sector index up 1.7 per cent. US Steel jumped 9.5 per cent to $20.15. Bank of America added 4.5 per cent to $8.11.
The Dow Jones industrial average gained 95.51 points, or 0.75 per cent, to 12,837.33 at the close. The Standard & Poor’s 500 Index advanced 13.20 points, or 0.98 per cent, to 1,357.98. The Nasdaq Composite Index rose 34.43 points, or 1.19 per cent, to end the day at 2,929.76.