U.S. Stocks End Sharply Higher After Chinese Market Surges

NEW YORK (AP) -

Investors were in a buying mood again on Thursday, driving U.S. stocks higher for the second straight day as they took advantage of this month’s heavy sell-off.

The rally came a day after the stock market delivered its biggest gain in almost four years, ending a steep six-day slump that was triggered by concerns about the health of the Chinese economy.

Energy stocks surged as the price of U.S. oil jumped more than 10 percent, closing back above $40 a barrel.

Investors were encouraged by a rebound in the Chinese stock market as the nation’s main index logged its biggest gain in eight weeks. They also welcomed a report indicating that the U.S. economy expanded in the second quarter at a much faster pace than previously estimated.

But mostly it was the opportunity to pick up beaten down shares that drove the rebound. By Tuesday’s close, the Standard & Poor’s 500 index had tumbled more than 10 percent from the all-time high that it set in May.

The Dow Jones industrial average climbed 369.26 points, or 2.3 percent, to 16,654.77. The index has recouped almost 1,000 points in the last two days. That’s more than half of its losses during a sharp six-day slump.

The S&P 500 index gained 47.15 points, or 2.4 percent, to 1,987.66. The Nasdaq composite rose 115.17 points, or 2.5 percent, to 4,812.71.

Thursday’s market action pushed the three indexes into positive territory for the week and nudged the Nasdaq out of the red for the year. The tech-heavy index is now up 1.6 percent for the year, while the Dow and the S&P 500 are still lower.

Meanwhile, the Commerce Department provided a surprise boost, reporting that the economy, as measured by gross domestic product, expanded at an annual rate of 3.7 percent in the April-June quarter. That’s a much bigger rebound in growth during the spring that previously estimated, and the strongest growth since last summer.

All of the 10 sectors in the S&P 500 rose, led by energy stocks. The sector rose 4.9 percent, paring its losses for the year to 20 percent.

Markets overseas also mounted rallies.

Germany’s DAX gained 3.2 percent. France’s CAC-40 increased 3.5 percent. Britain’s FTSE 100 rose 3.6 percent.

In other Asian stock trading, Hong Kong’s Hang Seng advanced 2.9 percent to 21,697.31 and Tokyo’s Nikkei 225 added 1.1 percent to 18,574.44.

Oil soared to its biggest one-day gain since March 2009, lifted by rising global stock markets and a report showing the U.S. economy grew 3.7 percent in the second quarter. U.S. oil rose $3.96, or 10.3 percent, to $42.56 a barrel. Brent crude, an benchmark for international oils imported by U.S. refineries, rose $4.42, or 10.3 percent, to $47.56 in London.

In metals trading, gold fell $2 to $1,122.60 an ounce. Silver rose 37.60 cents to $14.42 an ounce. Copper gained 8.6 cents to $2.33 per pound.

U.S. government bond prices fell. The yield on the 10-year Treasury note rose to 2.19 percent from 2.18 percent on Wednesday.

The dollar rose to 121.02 yen from Wednesday’s 119.16 yen. The euro edged down to $1.1242 from the previous session’s $1.1337.

In other futures trading:

  • Wholesale gasoline rose 10.19 cents to $1.435 a gallon.
  • Heating oil gained 11.51 cents to $1.496 a gallon.
  • Natural gas fell 5.5 cents to $2.638 per 1,000 cubic feet.