U.S. Stocks Edge Higher Amid Hopes For China Growth
NEW YORK (AP) — U.S. stocks are inching mostly higher in noon trading Monday as Wall Street winds down the year in this holiday-shortened week. Asian shares rose after Chinese regulators announced changes designed to stimulate the world's second-largest economy. Several European indexes fell as Greece headed for early elections that could endanger its bailout program.
KEEPING SCORE: The Standard & Poor's 500 index rose four points, or 0.2 percent, to 2,093 as of 12:14 p.m. Eastern. The Dow Jones industrial average was flat at 18,050 and the Nasdaq composite rose five points, or less than 0.1 percent, to 4,812.
GREEK JITTERS: News that Greece will hold early general elections next month stoked concerns over the country's financial future. An opposition party that is against the terms of the country's bailout program is leading in the polls, and investors worry it will seek changes if it wins the election. The Athens exchange was down 4 percent, having fallen as much as 11 percent earlier.
EUROPE: Other European markets were mixed. France's CAC-40 edged up 0.5 percent, Germany's DAX rose 0.1 percent and the U.K.'s FTSE 100 rose 0.4 percent. Spain's IBEX 35 fell 0.8 percent and Italy's benchmark index fell 1.1 percent.
U.S. BACKDROP: Despite troubles abroad, the U.S. economy has provided support for U.S. stocks as 2014 comes to a close. Employers are on track to hire nearly 3 million workers this year, the most since the dot-com boom year of 1999. The unemployment rate has dropped to 5.8 percent, down about a percentage point since the start of the year. And the U.S. economy grew at an annualized rate of 5 percent in the July-September quarter, the fastest in 11 years.
The S&P 500 has hit record highs more than 50 times so far this year. The index has tripled from the 12-year lows it reached at the depths of the financial crisis in 2009.
THE QUOTE: John Manley, chief equity strategist at Wells Fargo Fund Management, said he expect the stocks are being pushed higher in part from what he calls "sleepy heads," investors who tend to put off plowing money into IRAs until the closing days of each year.
"All of sudden they wake up, and realize, 'I need to do this to get my tax deduction," he says.
CHINESE BANKING: China's official Xinhua News Agency reported Sunday that regulators will change accounting rules for bank deposits to free up more money for lending. That could help boost economic growth, which slumped to a five-year low in the latest quarter. The report came after government data on Saturday showed profits for China's biggest industrial companies fell 4.2 percent in November from a year earlier, accelerating from the previous month's 2.1 percent decline. China's state-owned banks rose on expectations of higher interest income from lending.
ANALYST'S TAKE: "Asian equities are off to a great start to the week, with investors growing increasingly optimistic about China deploying stimulus," strategist Stan Shamu of IG Markets said in a report.
ASIA'S DAY: Hong Kong's Hang Seng index gained 1.8 percent and the Shanghai Composite Index added 0.3 percent. Markets in Sydney, Singapore and Manila also rose. South Korea's Kospi was off 1 percent.
ICAHN TARGET: The Manitowoc Co. rose $1.62, or 8 percent, to $22.54 on news that activist investor Carl Icahn took a 7.8 percent stake in the crane maker and is pushing for the company to split into two.
PILL POP: Gilead Sciences rose $2.87 to $96.66 for a gain of 3 percent, one of the biggest in the S&P 500. The biotechnology company expanded an agreement with a Johnson & Johnson unit for development and sale of a HIV treatment.
RUBLE TROUBLES: Russia's currency was also in focus. The ruble fell 8 percent on Monday after a rally last week. Russian monetary officials have made stabilizing the currency a priority amid slumping oil revenues and unease about the country's economic outlook. Mizuho Bank warned in a report that this "may not be the end of the troubles" for the Russian economy.
ENERGY: Benchmark U.S. crude fell 97 cents to $53.77 per barrel on the New York Mercantile Exchange. On Friday, the contract plunged $1.11 to settle at $54.73.
CURRENCIES: The dollar rose to 120.60 yen from 120.35 Friday. The euro edged down to $1.2176 from Friday's $1.2205.
– by AP Reporter Bernard Condon