US Stocks Rise as Powell Tapped for New Term
(AP) -- Stocks rose broadly in morning trading on Wall Street Monday as investors head into a holiday-shortened week with reassurance about leadership at the Federal Reserve.
The S&P 500 rose 0.9% as of 10:19 a.m. Eastern. The Dow Jones Industrial Average rose 274 points, or 0.8%, to 35,876 and the Nasdaq rose 0.9%.
Technology companies led the gains. Apple rose 3.1% and chipmaker Nvidia rose 3.5%.
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Retailers and other companies that rely on consumer spending also made solid gains. Gap rose 2.5% and Best Buy rose 4%. Retailers are on the cusp of the busy holiday shopping season, which traditionally kicks off right after the Thanksgiving holiday.
Real estate and health care stocks lagged the broader market.
Markets were reassured after President Joe Biden said he would nominate Jerome Powell for a second four-year term at the helm of the Federal Reserve, a vote of confidence in Powell's handling of central bank policies during the brutal disruptions caused by the coronavirus pandemic.
The central bank is starting to trim bond purchases that have helped maintain low interest rates in an effort to support the economy and markets. The move to ease up on that support comes as rising inflation hangs over the economic recovery. That has investors closely watching the Fed to see whether the process remains smooth or whether it the Fed will have to change its strategy in light of pressure from inflation.
Bond yields rose. The yield on the 10-year Treasury rose to 1.59% from 1.54% late Friday. Banks, which rely on higher yields to charge more lucrative interest on loans, gained ground. Bank of America rose 2.4%.
The dollar also strengthened against other currencies. The price of gold, a haven for when investors feel anxious, fell 1.9%.
Markets in Europe and Asia were mixed as a resurgence of coronavirus outbreaks prompted some countries to look to stricter precautions to curb yet another wave of the pandemic.
Investors face a relatively light week of economic updates. The National Association of Realtors reported surprisingly good sales for previously occupied homes in October on Monday. The Commerce Department will report October data for for new home sales on Wednesday, along with data on third-quarter gross domestic product.
Markets in the U.S. will be closed on Thursday for the Thanksgiving holiday. They will also close early on Friday.