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Last Updated : Sep 09, 2015 07:44 AM IST | Source: Reuters

Wall Street jumps 2% as China gains fuel global gains

The Dow Jones industrial average rose 390.3 points, or 2.42 percent, to 16,492.68, the S&P 500 gained 48.19 points, or 2.51 percent, to 1,969.41 and the Nasdaq Composite added 128.01 points, or 2.73 percent, to 4,811.93.


US stocks rose more than 2 percent on Tuesday, bouncing after steep losses last week and a China-fueled rebound in global equities.

Gains were broad-based and followed a three-day US holiday weekend. All but one of the 10 major S&P sectors - energy - ended with gains of more than 2 percent.

Hopes for more stimulus measures from the Chinese government increased after data on Tuesday showed that China's imports shrank far more than expected in August, falling for the 10th straight month.

Chinese stocks surged in a late rally, sparking a rebound in global equities. Late on Monday, China said it would remove a tax on dividend incomes for investors who hold stocks for more than a year in an effort to encourage longer-term investment.

"We had some nice buying opportunities with the sell-off in August, and I think people are starting to take advantage of that and put money to work," said Larry Peruzzi, senior equity trader at Cabrera Capital Markets Inc in Boston.

"In China it seems like there is a willingness to continue with stimulus, so hopefully those markets will stabilize."

The Dow Jones industrial average rose 390.3 points, or 2.42 percent, to 16,492.68, the S&P 500 gained 48.19 points, or 2.51 percent, to 1,969.41 and the Nasdaq Composite added 128.01 points, or 2.73 percent, to 4,811.93.

All three major US stock indexes posted losses of at least 3 percent for last week.

Global financial markets have been rattled in recent weeks by fears that China's slowdown could drag on already sluggish global growth, prompting some investors to bet that the US central bank will delay a hike until the end of the year.

A mixed report on the US jobs market for August on Friday added to investor uncertainty over whether the Federal Reserve will increase interest rates at its Sept. 16-17 meeting.

Apple shares gave the biggest boost to the S&P and the Nasdaq, rising 2.8 percent to USD 112.31, a day before the iPhone maker is expected to unveil new offerings.

Media General fell 6 percent to USD 10.48 after it said it would buy diversified media company Meredith Corp for about USD 2.34 billion to create the third-largest local TV station owner in the United States. Meredith was up 9.9 percent at USD 50.47.

After the bell, Yahoo shares were down 3.1 percent at USD 29.95 after it said it was considering its options following an Internal Revenue Service denial of its request on a tax ruling related to Yahoo's plans to exit a stake in Alibaba Group Holding Ltd.

In addition, shares of United Continental Holdings were down 2.8 percent at USD 55.90 after the bell following the company's announcement that Chief Executive Jeff Smisek had stepped down.

Advancing issues outnumbered declining ones on the NYSE by 2,439 to 644, for a 3.79-to-1 ratio on the upside; on the Nasdaq, 2,202 issues rose and 646 fell for a 3.41-to-1 ratio favoring advancers.

The benchmark S&P 500 index posted one new 52-week high and no new lows; the Nasdaq Composite recorded 46 new highs and 30 new lows.

About 6.8 billion shares changed hands on US exchanges, compared with the 7.5 billion daily average for the month to date, according to data from BATS Global Markets.

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First Published on Sep 9, 2015 07:44 am
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