Relieved Investors Send Stocks Up
NEW YORK (AP) -- US stocks are jumping Monday after Hurricane Irma weakened without causing as much damage as many had feared. Travel companies and insurers are also rising and home-improvement companies like Lowe's and Home Depot, which rallied last week, fell.
Global investors were also relieved after a North Korean national holiday passed without any other actions that would raise tensions between that country and the U.S. Bond prices fell, sending yields higher. That helped bank stocks because rising yields mean banks can charge higher interest rates on loans.
KEEPING SCORE: The Standard & Poor's 500 index was on track for a new high. It rose 25 points, or 1.1 percent, to 2,488 as of 12:55 p.m. Eastern time. The Dow Jones industrial average gained 246 points, or 1.1 percent, to 22,044. The Nasdaq composite jumped 72 points, or 1.1 percent, to 6,432 and was also close to a record. The Russell 2000 index of smaller-company stocks added 15 points, or 1.1 percent, to 1,414.
The standoff between the U.S. and North Korea and worries about the damage from hurricanes Harvey and Irma had weighed on the market in the last month. The S&P 500 fell almost 0.8 percent from Aug. 7, the day of its last record high, and Friday.
STORMY WEATHER: Irma hit the U.S. as a major Category 4 hurricane Sunday and is still battering Florida and Georgia. It's caused severe flooding and knocked out power to millions, but the storm weakened shortly before it came ashore. While the damage is still being assessed, small insurers, especially ones that do a lot of business in Florida, climbed as investors anticipate they won't have to pay out as much in claims as it looked like they would.
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HCI Group jumped $5, or 16.3 percent, to $35.78 while Heritage Insurance gained $2.22, or 23.7 percent, to $11.59. Larger insurers also rallied. XL Group advanced $1.92, or 5 percent, to $40.53 and Travelers gained $3.25, or 2.7 percent, to $123.01.
Investors also expected that travel-related companies won't take such a big hit from the storm. Royal Caribbean Cruises jumped $4.02, or 3.4 percent, to $121.47 and American Airlines gained $1.55, or 3.4 percent, to $45.15. Travel booking site Priceline rose $22.93, or 1.2 percent, to $1,861.50.
LAGGARDS: Home improvement retailers fell. They climbed last week after investors anticipated their business could pick up as homeowners were affected by the storm. Home Depot dropped $2.05, or 1.3 percent, to $157.61 and Lowe's declined $1.09, or 1.4 percent, to $77.47.
Orange juice prices, which surged in early September, gave up some of their recent gains. Futures had risen to $1.54 a pound Friday from $1.30 at the end of August and slipped to $1.53 a pound on Monday.
NORTH KOREA: North Koreans observed 69th anniversary of the country's founding, but it the country did not test another intercontinental ballistic missile, as South Korea's government had warned it might do. Rising tensions between the U.S. and North Korea have weighed on stocks in recent weeks and raised the prices of gold and bonds.
Bond prices sank. The yield on the 10-year Treasury note rose to 2.12 from 2.05 percent. The price of gold fell $14.20, or 1.1 percent, to $1,337 an ounce. High-dividend stocks like phone and utility companies traded higher but didn't do as well as the rest of the market. Those companies tend to do better when bond yields are falling, as investors see them as an alternative to bonds because of their large dividend payments.
TECH ADVANCES: Technology companies helped lead the way. Apple, which will unveil its newest iPhone on Tuesday, rose $2.92, or 1.8 percent, to $161.55 and Facebook rose $2.33, or 1.4 percent, to $173.28. Microsoft added 71 cents, or 1 percent, to $74.69 and Mastercard rose $4.15, or 3 percent, to $141.37.
CURRENCIES: The dollar rose to 109.12 yen from 107.79 yen late Friday. The euro slid to $1.1964 from $1.12028.
ENERGY: Benchmark U.S. crude rose 69 cents, or 1.5 percent, to $48.17 a barrel in New York while Brent crude, used to price international oils, added 5 cents to $53.83 a barrel in London.
OVERSEAS: Germany's DAX gained 1.4 percent and the French CAC 40 rose 1.2 percent. The FTSE 100 index in Britain picked up 0.5 percent. The benchmark Nikkei 225 index in Japan jumped 1.4 percent as the yen came off recent highs against the dollar, easing pressure on exporters. South Korea's Kospi advanced 0.7 percent and Hong Kong's Hang Seng added 1 percent.
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