Signs of Strength in Economy and Banking Lift Stocks; S.&P. 500 Up 2.2%
Wall Street began August with a broad surge on Monday afternoon, fueled by positive news about bank earnings in Europe and a survey that said American manufacturing was stronger than expected in July.
The widely followed Standard & Poor’s index of 500 stocks climbed more than 24 points, or 2.2 percent, in preliminary figures. The Dow industrials gained 208.44 points, or 1.99 percent, to close at 10,674.38.
While concerns over Europe have recently had an influence on investor sentiment, the banks’ earnings, results of the European banking stress tests and purchasing managers’ index for the 16 countries that use the euro appeared to ease some pessimism that a global credit crisis was imminent.
In the United States, investors saw positive signs in the Institute for Supply Management’s survey, which fell less than expected in July, and in an unexpected rise in construction spending reported for June.