U.S. stocks rose, responding to Standard & Poor’s 500 Index falling to a three-week low yesterday, as investors speculated that the economic effects of the first partial government shutdown in 17 years would be limited.
Stocks advanced ignoring lawmakers failure to reach an agreement to keep the government fully funded for the next fiscal year. Prior to Tuesday, the Dow had fallen in seven of the past eight sessions, including a 129-point slide on Monday.
The S&P 500 rose 0.8% to 1,695 at 4 p.m. in New York, after falling yesterday for the seventh time in the past eight sessions. The Dow Jones Industrial Average added 62 points, or 0.4%, to 15,191.70. About 6.3 billion shares changed hands on U.S. exchanges, or 9.3% more than the the three-month average.
“We have gone through this before, it’s not too surprising that investors arent frightened by it,”Bruce Bittles, chief investment strategist at RW Baird & Co., said by phone from Sarasota, Florida. His firm oversees $100 billion. “The selling pressure lifted, and that has encouraged a lot of buyers here looking into buying the dip.”
In corporate world, Ford Motor Co. added 1.9% to $17.19, headed for its biggest increase in 3 weeks. The Dearborn, Michigan-based car-maker reported a 5.7% rise in U.S. sales of cars and light trucks in September, beating estimates for no change.
Apple Inc. climbed 2.4% to $487.96 after billionaire Carl Icahn wrote on Twitter that he “pushed hard” for a $150 billion stock buyback in talks with Chief Executive Officer Tim Cook. Icahn, who owns $1 billion in Apple shares, said he plans to continue discussions in three weeks.
Under Armour soared 4.1% to a record $82.69 as JP Morgan upgraded the stock to “neutral” from “underweight” rating, betting on footwear, womenswear, and product innovation to drive sales in the North America region, which contributed to 94% of total revenue last year. The shares jumped 33% last quarter.
Netflix Inc. rose 5% to a record $324.62. MKM Partners LLC raised its price target for the stock to $370 from $285, saying the world’s largest subscription-streaming service’s management will be able to win customers in key international markets such as the U.K.