Tech and industrial shares tick up on earnings hopes
US stocks capped their best three-day run in 10 months yesterday boosted by technology and industrial shares, after Spain unveiled an austerity plan that reassured investors Europe was addressing its fiscal ills.
Spain said it will slash civil service pay and cut public-sector jobs, just a few days after EU finance ministers approved a €750bn (£634bn) bailout package to stem the debt crisis, cheering investors.
“The guarantees have placated investors for the time being,” said Chad Morganlander, portfolio manager at Stifel, Nicolaus & Co in Florham Park, New Jersey.
Investors have worried that a European debt crisis that began in Greece could spread around the world and potentially curb global growth.
Technology shares posted the most gains as International Business Machines forecast roughly doubling its profit by 2015 a day after Intel said it expects annual earnings growth to double over the next few years.
IBM shares jumped 4.6 per cent to $132.68 and Intel rose 3.6 percent to $23.09. Fellow Dow component DuPont gained 4.2 per cent to $39.26.
The Dow Jones industrial average rose 148.65 points, or 1.38 per cent, to 10,896.91. The Standard & Poor’s 500 Index added 15.88 points, or 1.37 per cent, to 1,171.67. The Nasdaq gained 2.09 per cent, to 2,425.02.