You are here
US: Stocks rise, ending Brexit rout
[NEW YORK] US stocks rallied on Tuesday in line with European markets after two straight sessions of steep declines in the wake of Britain's surprise decision to leave the European Union.
Analysts had predicted that stocks would rebound at some point after the S&P 500 shed more than five percent over two days following the shock Brexit vote. Some had viewed the market as oversold in the short run.
Especially strong sectors included banks, technology, energy and airlines. All had experienced bigger-than-average drops during the selloff.
The Dow Jones Industrial Average rose 1.6 per cent to 17,409.72.
The broad-based S&P 500 gained 1.8 per cent at 2,036.09, while the tech-rich Nasdaq Composite Index jumped 2.1 per cent to 4,691.87.
Analysts cautioned that Tuesday's rally might not have staying power and US markets could see more volatility if European markets go through another bout of selling.
"We retraced about one third of the move downward and we still have as many questions as we did two days ago," said Art Hogan, chief market strategist at Wunderlich Securities.
Analysts do not expect the US economy to be as directly impacted by Brexit as Europe, although a stronger dollar would challenge American companies that rely on exports.
Banking shares were upward bound, with Bank of America and JPMorgan Chase gaining 4.3 per cent and 3.3 per cent, respectively.
Energy stocks benefited from a jump in oil prices. ExxonMobil advanced 2.3 per cent and Schlumberger 2.1 per cent.
Delta Air Lines climbed 3.9 per cent and United Continental rose 3.2 per cent.
Technology stocks that gained included Apple, up 1.7 per cent, Facebook 3.4 per cent and Microsoft 2.1 per cent.