NEW YORK (Reuters) — U.S. stocks rose
on Monday after closing Friday their worst week since August as
upbeat economic data from the United States and Europe boosted
optimism ahead of a key Federal Reserve decision later in the week.
Investors have been trying to gauge when the U.S. central bank will
start winding down its market-friendly $85 billion monthly bond
purchases, with some expecting the Fed to announce a tapering in
March.
Stronger economic data of late, including Monday's numbers showing
U.S. manufacturing output rose for a fourth straight month in
November and last month's payroll report, led some to believe the
tapering could come as soon as the Fed's meeting this week.
The Fed has said it will slow the program when certain economic
indicators meet its growth targets.
Global manufacturing and business activity expanded in December, as
euro zone businesses ended the year on a high thanks to a surge in
new orders, though the rate of manufacturing growth slowed in China.
"There are signs of growth here in U.S. is being emulated elsewhere,
the recovery is in relatively good footing worldwide and the Fed's
decision to eventually start to taper is positive in the long run,"
said Peter Jankovskis, co-chief investment officer at OakBrook
Investments in Lisle, Illinois.
"The market is waiting to see what the Fed is going to decide to
do," he said. "Bottom line, the economy continues to show signs of
strength and eventually the market will react positively to that."
The Dow Jones industrial average <.DJI> rose 129.21 points or 0.82
percent, to 15,884.57, the S&P 500 <.SPX> gained 11.22 points or
0.63 percent, to 1,786.54 and the Nasdaq Composite <.IXIC> added
28.542 points or 0.71 percent, to 4,029.518.
LSI Corp <LSI.O> was the best performer on the S&P 500 after Avago
Technologies <AVGO.O> agreed to buy LSI for $6.6 billion. LSI shares
jumped 38.6 percent to $10.96 and Avago added 9.7 percent to $50.10.
In other deal news, AIG Inc <AIG.N> rose 1.1 percent to $50.28 after
it said it would sell its aircraft-leasing business to AerCap
Holdings NV <AER.N> in a deal valued at about $5.4 billion. AerCap
surged 33.1 percent to $33.17.
Exxon Mobil <XOM.N> led points gains on the S&P 500 after Goldman
Sachs raised its rating on the stock to "buy" from "neutral," saying the company
was nearing a turning point in terms of production growth and capital intensity.
Shares added 2 percent to $97.22.
IBM's <IBM.N> 2.9 percent gain to $177.85 made it the top percentage
and points gainer on the Dow industrials.
Shares of Herbalife Ltd <HLF.N> jumped 9.4 percent to $74.83 after
the company announced there were no material changes to its
financial re-audit.
Boeing <BA.N> shares rose 1.7 percent in after-hours trading after
it said it approved a $10 billion stock repurchase and raised its
dividend 50 percent to 73 cents per share.
Advancers beat decliners on the NYSE by a ratio of 2 to 1. On the
Nasdaq, about 15 issues rose for every seven that fell.
About 6 billion shares changed hands on U.S. exchanges, slightly
below the 6.1 billion average so far this month, according to data
from BATS Global Markets.
(Reporting by Rodrigo Campos; editing by
Nick Zieminski)
Investors have been trying to gauge when the U.S. central bank will
start winding down its market-friendly $85 billion monthly bond
purchases, with some expecting the Fed to announce a tapering in
March.
