U.S. stocks rebounded on Tuesday as investors bet that a
dismal January factory barometer released on Monday may be the product of rough
winter weather that put commerce on hold and not due to softening demand.
At the close of U.S. trading, the Dow Jones Industrial
Average rose 0.47%, the S&P 500 index rose 0.76%, while the Nasdaq
Composite index rose 0.86%.
Stocks took a nosedive on Monday after the Institute for
Supply Management said its manufacturing index fell to a seven-month low in
January.
The ISM’s manufacturing purchasing managers’ index came in
at 51.3 in January, down from 57.0 in December.
Analysts were expecting the index to inch down to 56.4 in
January.
The report added new order growth fell at its fastest rate
in 33 years, with the new orders index dropping to 51.2 from 64.4 in December.
The employment index fell from 55.8 in December to 52.3, the weakest since
June.
Also on Monday, U.K.-based Markit Economics reported that
its U.S. manufacturing PMI came in at a three-month low of 53.7 for January,
missing expectations for a 53.8 reading.
By Tuesday, stocks rebounded on expectations that rough
winter weather including blizzards and frigid temperatures across much of the U.S.
may have disrupted commerce.
Markets remained eager to see how a less weather-sensitive
report on the U.S. service sector report due out on Wednesday will come in
coupled with Friday's jobs report.
Elsewhere, the Commerce Department reported earlier Tuesday
that U.S. factory orders fell 1.5% in January, better than expectations for a
decline of 1.7%.
Separately, Microsoft shares rose on news the company named
its top cloud computing executive Satya Nadella as its new CEO.
On the earnings front, investors applauded fourth-quarter
reports from fast-food retailer Yum Brands and fashion accessory retailer
Michael Kors Holdings, though J.C. Penney disappointed with soft same-store
sales data.
Leading Dow Jones Industrial Average performers included
Merck, up 2.71%, DuPont, up 2.43%, and Pfizer, up 2.39%.
The Dow Jones Industrial Average's worst performers included
United Technologies, down 1.15%, Boeing, down 0.95%, and UnitedHealth, down
0.57.%.
European indices, meanwhile, finished mixed.
…. Read more on apexmarkets.co.nz
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