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US: Wall St surges over 1%, looks past Paris attacks
[LONDON] Wall Street had its strongest session in three weeks on Monday, with sizeable gains in energy shares as investors bet Friday's deadly attacks in Paris would have little long-term impact on the US economy and corporate earnings.
US oil prices rose after French air strikes in Syria in reaction to multiple attacks in Paris on Friday that killed 129 people, with Islamic State claiming responsibility.
Exxon's shares jumped 3.58 per cent and Chevron rallied 4.38 per cent.
The three major US stock indexes had opened with losses but soon turned around, with all closing more than 1 per cent higher.
The rally allowed the S&P 500 to recover about half of its losses from last week. The three major US indexes lost more than 3 per cent last week after rallying over 8 per cent in October. "Markets are slowly becoming more and more immune to these types of events," said John Brady, managing director at RJ O'Brien & Associates in Chicago. "Right at the opening there was a bit of a panic trade and then from there more steady hands - more professional, deep-pocketed hands - came in and bought the market." All 10 major S&P sectors rose, led by a 3.25 per cent leap in energy, although companies linked to travel and leisure took a hit.
American Airlines dropped 1.43 per cent, United Continental 1.22 per cent and Delta Airlines 2.16 per cent.
Cruise operator Carnival Corp fell 1.53 per cent, while travel company Expedia was down 2.13 per cent.
Monday's gains hint at a resumption of a rally which began in October and stalled at the start of November, said Frank Davis, director of sales and trading at LEK Securities in New York. "But the volume is not heavy, so I wouldn't get overly excited," he added.
In their strongest day since Oct 22, the Dow Jones industrial average ended 1.38 per cent higher at 17,482.61 points and the S&P 500 gained 1.49 per cent to 2,053.17.
The Nasdaq Composite jumped 1.15 per cent to 4,984.62.
Billionaire investor Warren Buffett told CNBC he was not selling any securities as a result of the attacks.
Buffett cut his stakes in Goldman Sachs and Wal-Mart in the quarter to Sept 30, and raised his holding in IBM, according to a regulatory filing. Goldman was up 0.9 per cent. IBM was up 1.5 per cent and Wal-Mart 2.6 per cent.
Despite uncertainty associated with Friday's attacks in France, Wall Street remains focused on expectations that the US Federal Reserve could hike interest rates in December for the first time in nearly a decade, Brady and Davis both said.
Last week, US stocks logged their largest weekly loss since August on the back of weak economic data and disappointing earnings from retailers such as Macy's. The three major US indexes lost more than 3 per cent last week after rallying over 8 per cent in October.
On Monday, Starwood Hotels fell 3.63 per cent to US$72.27 after agreeing to be bought by Marriott International for US$12.2 billion, or US$72.08 per share. Marriott rose 1.35 per cent.
NYSE advancers outnumbered decliners 2,222 to 822. On the Nasdaq, 1,709 issues rose and 1,091 fell.
The S&P 500 showed four new 52-week highs and 14 lows, while the Nasdaq recorded 16 new highs and 153 lows.
About 6.7 billion shares changing hands on US exchanges, below the 7.2 billion daily average for the past 20 trading days, according to Thomson Reuters data.