Closing Update: Markets Rebound in Broad-Based Rally; Industrial, Energy Stocks Pace Gains

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Stocks rebounded from a week of mostly declines last week, closing Monday with strong gains ahead of the Fed's start on Tuesday of its final two-day policy-setting meeting of the year. Advances today were supported by economic data pointing to growing strength in many parts of the U.S. and global economies, although the consensus appears to be the recent data has not been so good that the Fed will decide to begin tapering its $85-billion monthly bond purchases this week. Nearly all sectors in the S&P 500 posted gains today, led by industrial and energy stocks. Two traditionally defensive sectors - consumer staples and healthcare - struggled.

Investors cheered another strong showing for global manufacturing as measured by an early reading of activity this month released today. Data provider Markit said its flash PMI reading for the U.S., which is based on about 85% of usual monthly survey replies, "improved solidly in December, despite the rate of growth having eased slightly over the month."

The flash purchasing managers' index reading slipped to a 54.4 December reading from a 54.7 reading in November, which marked the highest PMI mark since December 2012. Markit's Flash Eurozone Composite PMI rose to 52.1 in December from 51.7 last month. Readings above 50 indicate expansion.

Also today, U.S. industrial production in November topped its pre-recession peak for the first time, surging a seasonally adjusted 1.1% from October levels, according to the Fed, which releases the report. That was the biggest jump in a year. A separate study today by the U.S. Bureau of Labor Statistics found non-farm productivity jumped 3% during Q3.

Commodities also ended mostly higher, with crude oil for January delivery rising 94 cents to settle at $97.47 per barrel. January natural gas fell 10 cents to $4.26 per 1 million BTU. February gold gained $9.80 to finish at $1,245.50 per ounce while March silver added 50 cents to $20.10 per ounce. March copper gained 2 cents, settling at $3.33 per pound.

Here's where the markets stood at end-of-day:

Dow Jones Industrial Average up 129.53 (+0.82%) to 15,884.89

S&P 500 up 11.23 (+0.63%) to 1,786.55

Nasdaq Composite Index up 28.54 (+0.71%) to 4,029.52

GLOBAL SENTIMENT

Hang Seng Index down 0.56%

Shanghai China Composite Index down 1.60%

FTSE 100 Index up 1.28%

UPSIDE MOVERS

(+) AGEN, Reports positive results from Phase II testing of its Prophage Series G-200 brain-cancer vaccine, with 90% of patients treated with Prophage were still alive six months after receiving the drug.

(+) LSI, Avago ( AVGO ) offers to acquire the semiconductor and software designer for $11.15 per share in cash - or about $6.6 billion overall.

(+) AER, Inks $5.4-billion deal with American International Group ( AIG ) to purchase AIG's International Lease Finance Corp subsidiary.

DOWNSIDE MOVERS

(-) USU, Uranium miner reaches agreement with a majority of holders of senior convertible notes and will replace $530 mln of the notes maturing October 2014 with new debt and equity. Expects to file Chapter 11 bankruptcy petition during Q1 of 2014.

(-) TTMI, Announces plans for a $150-million offering of convertible senior notes due 2020.

(-) WPCS, Fiscal Q2 revenue declines 7.8% year over year to $7.36 mln.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

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This article appears in: Investing , Commodities

Referenced Stocks: AIG , AVGO

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