Wall Street kicks off October with broad rally, boosted by economic cheer
Wall Street stocks surged to a higher close on Friday, entering the final quarter of 2021 in a buying mood boosted by positive economic data, progress in the battle against COVID, and Washington developments on the potential passage of an infrastructure bill.
All three major U.S. stock indexes seesawed earlier in the session, but began trending higher by late afternoon, led by economically sensitive cyclicals.
The Dow Jones Industrial Average (.DJI) rose 482.54 points, or 1.43%, to 34,326.46; the S&P 500 (.SPX) gained 49.5 points, or 1.15%, at 4,357.04; and the Nasdaq Composite (.IXIC) added 118.12 points, or 0.82%, at 14,566.70.
Economic optimism prompted value stocks (.IVX) to outperform growth (.IGX), and transports (.DJT) and smallcaps (.RUT) to fare better than the broader market.
The rally gained momentum after the White House announced U.S. President Joe Biden was getting more involved in negotiations over the infrastructure spending bill being debated on Capitol Hill.
Merck & Co Inc (MRK.N) revealed that a recent study showed its experimental oral drug for COVID-19 cut risk of death and hospitalization by about 50%, sending its shares jumping 8.4% and boosting economic reopening sentiment.
While Biden signed into law a stop-gap bill to keep the government running through Dec. 3, lawmakers only succeeded in kicking the can down the road.
This lack of resolution prompted rating agency Fitch to warn that the United States' 'AAA' credit rating could be at risk.
Reference: Reuters
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