USA: U.S. stocks close up one percent as Senate announce agreement on a deal to reopen the federal government.

Record ID: 187280

  • Title: USA: U.S. stocks close up one percent as Senate announce agreement on a deal to reopen the federal government.
  • Date: 16th October 2013
  • Summary: SARASOTA, FLORIDA, UNITED STATES (OCTOBER 16, 2013) (REUTERS) (SOUNDBITE) (English) DAVID KOTOK, CHIEF INVESTMENT OFFICER, CUMBERLAND ADVISORS "This fight is now about how much the federal deficit shrinks. Whether it goes down 200 billion, or 300 billion or 500 billion is now not relevant. It's in a downward path, slow growth, low inflation, low interest rates. Bullish, stocks are going higher."
  • Embargoed: 31st October 2013 12:00
  • Keywords:
  • Location: Usa
  • Country: USA
  • Topics: Economy,Politics
  • Reuters ID: LVABVEYLMECZ6LHXDPX1XSYE8JCJ
  • Story Text: U.S. stocks closed more than one percent higher on Wednesday (October 16) after Senate leaders said they had a deal to reopen the federal government and raise the debt ceiling, which would avoid the threat of a debt default.
    U.S. Senate Majority Leader Harry Reid and Senate Republican leader Mitch McConnell said senators had come to an agreement that will reopen the government through Jan. 15 and raise the debt ceiling until Feb. 7. The House of Representatives planned to vote on the measure later in the day.
    The day's gains brought the S&P 500 within a few points of its all-time closing high of 1,725.52, set on Sept. 18. Trading volume has been below average, however, as many investors stayed on the sidelines until a resolution of the fiscal issues was official.
    With a potential debt deal on the horizon, David Kotok of Cumberland Advisors says the underlying economics point to a rally in equities.
    "This fight is now about how much the federal deficit shrinks. Whether it goes down 200 billion (USD), or 300 billion or 500 billion is now not relevant. It's in a downward path, slow growth, low inflation, low interest rates. Bullish, stocks are going higher," said Kotok.
    Gains were broad, with all 10 S&P 500 sectors solidly higher, led by financial stocks, which rose 2.1 percent. Other groups tied to the pace of economic growth, including energy, also jumped. Crude oil rose 1 percent while gold was essentially flat.
    About 78 percent of stocks traded on the New York Stock Exchange ended higher while 69 percent of Nasdaq-listed shares closed up.
    The Dow Jones industrial average was up 205.82 points, or 1.36 percent, at 15,373.83. The Standard & Poor's 500 Index was up 23.48 points, or 1.38 percent, at 1,721.54. The Nasdaq Composite Index was up 45.42 points, or 1.20 percent, at 3,839.43.
    J.P. Morgan Chase & Co will pay $100 million to settle charges for the "London Whale" trading scandal, the Commodity Futures Trading Commission said on Wednesday. Shares of the Dow component rose 3.2 percent to $54.
  • Copyright Holder: REUTERS
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