 "Commodities outlook leads US stocks to five-month high")
New York: Stocks hit a five-month high on Tuesday after strong import data from major metals consumer China and a bullish forecast by Alcoa boosted the outlook for commodities companies and pointed to a stronger global economy.
Copper prices rose 3.2 percent, the best performance since late November, after China reported copper imports rose 12.6 percent last month.
Aluminum maker Alcoa Inc on late Monday posted revenue that topped expectations and gave a positive outlook, sending its shares up 1.1 percent to $9.52.
[caption id=“attachment_178287” align=“alignleft” width=“380” caption=“AFP”]
[/caption]
Materials companies’ shares led the top S&P 500 sectors with a gain of 2.2 percent.
“Materials have been one of the weaker areas, so values are quite extraordinary if you believe the recovery is going to drive prices higher,” said Robert Lutts, president and chief investment officer at Cabot Money Management in Salem, Massachusetts.
“The economic data coming out in the US is turning some heads, coming much better than most were expecting.”
The Dow Jones industrial average rose 112.32 points, or 0.91 percent, to 12,505.01. The S&P 500 Index gained 15.03 points, or 1.17 percent, to 1,295.73. The Nasdaq Composite added 34.72 points, or 1.30 percent, to 2,711.28.
The Dow and S&P 500 hit their highest intraday levels in five months. A close above 1,285.09 would be the highest on the S&P since at least 1 August and would pierce technical resistance, which could augur further gains.
Mining stocks led European markets higher. The STOXX Europe 600 Basic Resources index rose 3.9 percent and the broad FTSEurofirst 300 gained 1.8 percent.
Still, caution prevailed ahead of debt auctions in Spain and Italy later in the week that will test market appetite in two countries at the forefront of the euro zone debt crisis.
Fitch Ratings said it does not expect to cut France’s AAA credit rating this year, while countries under review such as Italy or Spain could be downgraded by one or two notches.
US bank stocks continued a rebound that has lifted the KBW bank index more than 8 percent so far this year. The S&P financial sector rose 1.9 percent.
Reuters