Stocks recover much ground after worst day of the year
NEW YORK — Strong housing and earnings reports helped stocks rebound from their worst day of the year.
The Dow Jones industrial average rose 157.58 points, or 1.1 percent, on Tuesday, to 14,756.78, winning back more than half of the 265 points it lost a day earlier. The Standard & Poor's 500 index logged its second-best day of the year.
Home construction topped 1 million last month, the highest level since June 2008. Robust earnings from companies including Coca-Cola also propelled the market higher.
A recovery in housing and a pickup in hiring were major catalysts driving the stock market's surge early this year. The Dow and the S&P 500 jumped 11.3 percent and 10.3 percent, respectively, in the first three months of 2013.
That run-up was interrupted Monday when stocks had their biggest decline since November.
Worries about an economic slowdown in China led to a drop in prices for oil, copper and other commodities, causing mining and energy stocks to fall. The rally had slowed earlier this month after reports of weak hiring and retail sales suggested that the economy was cooling off.
“This is the first time in a while that we've had pretty positive numbers,” said JJ Kinahan, chief derivatives strategist for TD Ameritrade. “We had one bad day yesterday. You can't say because of that one bad day that all bets are off.”
While Chinese growth fell short of expectations, Monday's sell-off may have been disproportionate to the slight slowdown in China's growth.
The world's second biggest economy still expanded at a rate of 7.7 percent in the first three months of the year, slowing from 7.9 percent the previous quarter and missing analysts' expectations by just 0.3 percentage points. China is watched closely because it is a major market for foreign goods from iron ore to smartphones. Investors hope demand from China can help offset weakness in the United States, Europe and Japan.
Mining companies rose Tuesday as commodities markets stabilized.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Consistency keeps Cellone’s Bakery customers coming back
- EPA to release biofuels proposal by June 1
- Tesla home battery at $7K, partnered with rooftop solar system, may help reduce power bills
- Cable company Charter buying Time Warner Cable for $55.3B
- With higher student debt than ever, millennials rely on support from parents
- Cuba’s dairy industry, once touted as a success, is struggling
- Charter Communications makes offer for Time Warner Cable
- Murray Energy expects to lay off as many as 1,800 more
- Developer hopes to make Allegheny Center a tech hub
- Shareholder vote causes ATI to review executive pay packages
- Keep pesky neighbors from stealing your Internet