US Stocks Rise on British Vote Hopes
NEW YORK (AP) -- U.S. stocks rose sharply on Monday as investors grew more hopeful that Britain will remain in the European Union, letting go of fears that have pulled stocks down in the last two weeks.
Asian stocks traded higher and indexes in Europe soared as the latest opinion polls and betting markets suggest it's more likely Britain will stay in the EU than leave it. Britons vote on the matter on Thursday.
The British pound rose sharply and investors dumped ultra-safe assets like U.S. government bonds, gold and utility stocks, sending those prices lower. Machinery and consumer companies jumped and energy companies rose with the price of oil.
Jim McDonald, chief investment strategist at Northern Trust, said Britain's status within the EU won't affect U.S. businesses very much, although it would hurt European banks. But he said investors are worried what will happen to the union if Britain does leave. For example, other countries might also think about backing out of the EU, doing greater damage to Europe and the global economy.
"It's not the direct effects that people are worried about, it's the indirect ones," he said.
The Dow Jones industrial average climbed 129.71 points, or 0.7 percent, to 17,804.87. The Standard & Poor's 500 index rose 12.03 points, or 0.6 percent, to 2,083.25. The Nasdaq composite gained 36.88 points, or 0.8 percent, to 4,837.21. U.S. stocks were on pace for much larger gains earlier in the day. At one time the Dow was up 271 points.
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The pound rose to $1.4693 from $1.4375, a large move.
Machinery companies climbed. Aerospace company Boeing added $2.93, or 2.3 percent, to $132.75 and Honeywell advanced $1.14, or 1 percent, to $117.06. General Electric rose 23 cents to $30.83.
Consumer stocks rose as investors bet people will spend more on shopping and travel. Amazon gained $7.62, or 1.1 percent, to $714.01 while travel booking site Priceline added $32.72, or 2.5 percent, to $1,341.96 and Nike rose 65 cents, or 1.2 percent, to $54.36.
Benchmark U.S. crude oil rose $1.39, or 2.9 percent, to $49.37 a barrel in New York. Brent crude, used to price international oils, gained $1.48, or 3 percent, to $50.65 a barrel in London. After a six-day losing streak, oil prices are up about 7 percent over the past two days.
Among energy stocks, Chevron rose $1.04, or 1 percent, to $102.61. Marathon Oil jumped $1.32, or 10 percent, to $14.48 after it agreed to pay $888 million for PayRock Energy.
Bond prices dropped as investors moved money out of ultra-safe assets. The yield on the 10-year U.S. Treasury note rose to 1.67 percent from 1.61 percent late Friday. That's an encouraging sign for banks since bond yields are used to set interest rates on many kinds of loans including mortgages, and banks will be able to make more money from lending as rates increase.
Bank of America rose 14 cents, or 1 percent, to $13.54 and Wells Fargo, the nation's biggest mortgage lender, rose 33 cents to $46.93.
JD.com stock jumped after the second-largest e-commerce site in China said it was buying Wal-Mart's Yihaodian marketplace as part of a broad partnership with the company. JD.com jumped 93 cents, or 4.6 percent, to $21.06.
FedEx rose after the federal government moved to dismiss charges against the shipping company. Prosecutors had planned to charge FedEx with knowingly delivering illegal prescription drugs to dealers and addicts, but late Friday the government dropped the case. The trial was set to begin Monday. FedEx picked up $2.22, or 1.4 percent, to $164.47.
Britain's FTSE 100 leaped 3 percent and France's CAC 40 rose 3.5 percent. Germany's DAX rocketed 3.4 percent higher. Japan's benchmark Nikkei 225 index surged 2.3 percent. South Korea's Kospi climbed 1.4 percent and Hong Kong's Hang Seng added 1.7 percent.
In other energy trading, wholesale gasoline added 8 cents to $1.58 a gallon. Heating oil edged up 5 cents to $1.53 a gallon. Natural gas rose 12 cents to $2.75 per 1,000 cubic feet.
Gold slipped $2.70 to $1,292.10 an ounce. Silver rose 10 cents to $17.51 an ounce. Copper added 4 cents to $2.09 a pound.
The dollar fell to 103.96 yen from 104.23 yen and the euro rose to $1.1314 from $1.1275.
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