Stocks advance to begin month
Stocks rose Monday as investors judged that the economy still isn't growing fast enough for the central bank to cut back on its stimulus program. That stimulus has been a major factor supporting a rally in stocks this year and the threat of it being withdrawn made stock markets more volatile last month.
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"You're seeing new money come in to the markets as we are in a new quarter," said Quincy Krosby, a market strategist at Prudential Financial. "New money is being put to work."Skip to next paragraph
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Eight of the 10 industry groups that make up the S&P 500 index rose, led by materials companies, a category that includes miners and chemical makers, and industrial companies. Utilities and phone companies were the only ones to decline.
This week's most closely watched economic release will be the government's monthly employment report Friday. Economists expect the U.S. added 165,000 jobs in June, a figure that would affirm the economy's steady, but slow, trajectory, said Scott Wren, a senior equity strategist at Wells Fargo Advisors.
"It's a confirmation of more of the same," said Wren. "More modest growth, more modest inflation, but not a big acceleration."
U.S. stocks also followed global markets higher. Japan's Nikkei 225 rose 1.3 percent, boosted by signs of improvement in Japan's economy.
In Europe, stock indexes rose after a mixed set of economic indicators for the region. While unemployment in the 17 countries that use the euro rose to another record high in May, manufacturing picked up in Britain, France and Italy and stabilized in Spain.
Germany's DAX index rose 0.3 percent and Britain's FTSE 100 index climbed 1.5 percent.
The yield on the 10-year Treasury note was unchanged from Friday at 2.49 percent. The note's yield surged to 2.66 percent last Monday as investors worried that the Fed was poised to reduce on its bond purchases. The yield on the 10-year Treasury note is used to set interest rates on many kinds of loans including home mortgages.
In commodities trading, the price of oil climbed $1.43, or 1.5 percent, to $97.99 a barrel. The price of oil rose on concerns that unrest in Egypt, the largest Arab nation, could spread and affect the transport of oil supplies in the Middle East and Africa.
Gold rose $32, or 2.6 percent, to $1,255.70 an ounce.
Trading will be curtailed this week due to the Independence Day holiday Thursday. The New York StockExchange will close at 1 p.m. on Wednesday and reopen on Friday.
The dollar edged lower against the euro and rose against the Japanese yen.
Among stocks making big moves:
— Onyx Pharmaceuticals surged $44.51, or 51 percent, to $131.33 after the company rejected a takeover bid from Amgen, a larger biotechnology company. Onyx said other companies have expressed interest in a buyout.
— Cablevision rose $1.62, or 9.6 percent, to $18.44 after Reuters reported that Time Warner Cable is considering making a bid for the company.
— Best Buy rose $2.41, or 8.8 percent, to $29.74 after Credit Suisse resumed its coverage of the stock with an "outperform" rating and a target price of $42. Analysts at the investment bank believe that the company's new approach to serving customers will help it increase its earnings.
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