US stocks surge as investors grow hopeful about British vote
NEW YORK (AP) — Global stocks are climbing Monday as investors grow more hopeful that Britain will remain in the European Union. In the U.S., consumer and machinery companies made the biggest gains, and energy companies rose along with the price of oil. Traders dumped ultra-safe assets like U.S. government bonds, gold and utility stocks, sending those prices lower.
KEEPING SCORE: The Dow Jones industrial average climbed 189 points, or 1.1 percent, to 17,863 as of 1:25 p.m. Eastern time. The Standard & Poor's 500 index rose 22 points, or 1 percent, to 2,092. The Nasdaq composite gained 68 points, or 1.4 percent, to 4,868. Stocks had fallen for the last two weeks, including six days out of the last seven.
BRITISH VOTE: The British pound rose sharply as the latest opinion polls and betting markets suggest it's more likely Britain will stay in the European Union than leave when citizens vote on the issue Thursday. The pound jumped to $1.4652 from $1.4375. Many expect that a British departure from the economic union would hurt that country's economy and possibly encourage other countries to leave the EU. Investors have worried about the outcome of the vote in recent weeks. The vote is expected to be close.
CONSUMER CLIMBERS: Consumer stocks rose as investors bet people will spend more on shopping and travel. Amazon gained $10.41, or 1.5 percent, to $716.80 while travel booking site Priceline added $44.12, or 3.4 percent, to $1,353.36 and Nike rose 85 cents, or 1.6 percent, to $54.56.
HEAVY METAL: Machinery companies climbed. General Electric rose 40 cents, or 1.3 percent, to $31 while aerospace company Boeing added $3.24, or 2.5 percent, to $133.06 and Honeywell advanced $1.44, or 1.2 percent, to $117.36.
ENERGY: Benchmark U.S. crude oil rose $1.13, or 2.4 percent, to $49.11 a barrel in New York. Brent crude, used to price international oils, gained $1.20, or 2.4 percent, to $50.37 a barrel in London. U.S. crude jumped almost 4 percent Friday to break a six-day losing streak.
Among energy stocks, Chevron rose $1.38, or 1.4 percent, to $102.95 and EOG Resources picked up $2.02, or 2.5 percent, to $82.91.
TECH GAINS: Software maker Adobe Systems, which will report its second-quarter results Tuesday, jumped $2.60, or 2.7 percent, to $98.18. E-commerce company eBay rose 90 cents, or 3.8 percent, to $24.69, to $24.68 while chipmaker Intel edged up 54 cents, or 1.7 percent, to $32.31.
BANKS BREAK OUT: Bond prices dropped as investors moved money out of ultra-safe assets. The yield on the 10-year U.S. Treasury note rose to 1.67 percent from 1.61 percent late Friday. That's an encouraging sign for banks since bond yields are used to set interest rates on many kinds of loans including mortgages, and banks will be able to make more money from lending as rates increase.
Bank of America rose 15 cents, or 1.1 percent, to $13.55 and Wells Fargo, the nation's biggest mortgage lender, rose 71 cents, or 1.5 percent, to $45.31.
DEAL: JD.com stock jumped after the second-largest e-commerce site in China announced a deal with Wal-Mart as part of a broader tie-up. JD.com will buy Wal-Mart's Yihaodian marketplace and Wal-Mart's Sam's Club China will open a flagship store on JD.com. Wal-Mart will also take a 5 percent stake in JD.com. JD.com jumped $1.31, or 6.5 percent, to $21.44.
SPECIAL DELIVERY: FedEx rose after the federal government moved to dismiss charges against the shipping company. Prosecutors had planned to charge FedEx with knowingly delivering illegal prescription drugs to dealers and addicts, but late Friday the government dropped the case. The trial was set to begin Monday. FedEx jumped $3.24, or 2 percent, to $165.49.
OVERSEAS: Britain's FTSE 100 leaped 3 percent and France's CAC 40 rose 3.5 percent. Germany's DAX rocketed 3.4 percent higher. Japan's benchmark Nikkei 225 index surged 2.3 percent. South Korea's Kospi climbed 1.4 percent and Hong Kong's Hang Seng added 1.7 percent.
CURRENCIES: The dollar fell to 104.02 yen from 104.23 yen and the euro rose to $1.1307 from $1.1275.
AP Markets Writer Marley Jay can be reached at http://twitter.com/MarleyJayAP . His work can be found at http://bigstory.ap.org/journalist/marley-jay