Fresh signs of healing in the manufacturing and banking industries are giving investors reason to extend a powerful July rally into a second month.
Stocks are rising in early trading on Monday as gains in overseas markets fed the recent momentum on Wall Street that gave the market its best July in 20 years. World markets mostly rose as surveys in China and Europe showed manufacturing activity is improving. Investors are hoping that figures on the manufacturing industry in the US released later on Monday will reveal a similar trend. Positive reports from European banks added to the day's upbeat news.
Barclays PLC said its first-half net profit increased 10 per cent on stronger earnings from its investment banking division. HSBC Holdings PLC reported a 57 per cent decline in its first-half profit, but results were better than anticipated. Still, losses from bad loans rose at both banks as consumers in the US and Britain had trouble repaying debt.
In other signs of investors' growing confidence, safe-haven assets like Treasurys and the US dollar fell, while oil and other commodities prices rose.
The major indicators begin the first trading day of August at their highest levels since the fall. The benchmark Standard & Poor's 500 index is just 7 points shy of the 1,000 level, a point it hasn't closed above since early November.
In the first half hour of trading, the Dow Jones industrial average rose 43.84, or 0.5 per cent, to 9,215.45. The Standard & Poor's 500 index rose 6.41, or 0.7 per cent, to 993.89, while the Nasdaq composite index rose 13.33, or 0.7 per cent, to 1,614.74. Stocks surged last month, reigniting a spring rally that had fizzled in June amid growing doubts that the economy was on solid footing. Stocks regained momentum as an increasing number of economic and corporate earnings reports suggested investors' bets had been well-founded.
{{/usCountry}}In the first half hour of trading, the Dow Jones industrial average rose 43.84, or 0.5 per cent, to 9,215.45. The Standard & Poor's 500 index rose 6.41, or 0.7 per cent, to 993.89, while the Nasdaq composite index rose 13.33, or 0.7 per cent, to 1,614.74. Stocks surged last month, reigniting a spring rally that had fizzled in June amid growing doubts that the economy was on solid footing. Stocks regained momentum as an increasing number of economic and corporate earnings reports suggested investors' bets had been well-founded.
{{/usCountry}}The reports have shown that companies aren't losing money at the rapid pace they were last fall and earlier this year. Though there are concerns that the aggressive cost-cutting measures businesses have undertaken to boost profits are not sustainable, several upbeat outlooks from companies like Intel Corp. and Caterpillar Inc suggest business conditions are indeed improving. "At this point through earnings season, patterns have been firmly established," said Lawrence Creatura, portfolio manager at Federated Clover.