WebSify
Follow us on
Mail
Print

US STOCKS-Wall St up on China, but U.S. factory data pares gains

Source : REUTERS
Last Updated: Mon, Dec 03, 2012 16:43 hrs

* ISM manufacturing lowest in three years

* Delta among suitors for Virgin Atlantic stake - sources

* Spain makes formal request for EU bank aid

* Dow off 0.1 pct, S&P up 0.1 pct, Nasdaq up 0.2 pct

By Rodrigo Campos

NEW YORK, Dec 3 (Reuters) - The S&P 500 edged up to rise for a fourth straight day on Monday as upbeat Chinese data lifted sentiment, but weak U.S. factory numbers cut into gains.

Wall Street opened higher on that data but pared most of its gains after U.S. manufacturing unexpectedly contracted in November, falling to its lowest in over three years in a sign the sector may be struggling to gain traction.

Concerns over budget dealings in Washington are expected to keep traders cautious as political wrangling continues over how to deal with spending cuts and tax hikes scheduled to kick in next year that could tip the U.S. economy back into recession.

China's economy picked up in November even as a broader global recovery remains fragile, with factory activity patchy elsewhere in Asia as demand from the developed world remains weak.

"It's not clear exactly which numbers to focus on, but data is probably positive for markets starting from the China release last night," said Paul Zemsky, head of asset allocation at ING Investment Management in New York.

Adding to the upbeat market tone, Spain formally requested the disbursement more than $50 billion of European funds to recapitalize its crippled banking sector while Greece said it would spend 10 billion euros ($13 billion) to buy back bonds in a bid to reduce its ballooning debt.

"There's other positive news out of Europe with Greeks buying back their debt," Zemsky said. "Net-net the news cycle is positive for (equity) markets."

The Dow Jones industrial average dipped 9.87 points, or 0.08 percent, to 13,015.71. The S&P 500 Index gained 0.82 point, or 0.06 percent, to 1,417.00. The Nasdaq Composite added 6.24 points, or 0.21 percent, to 3,016.49.

The S&P 500 on Friday closed its fifth positive month in six and is up 8 percent since the end of May.

U.S. Treasury Secretary Timothy Geithner pushed Republicans on Sunday to offer specific ideas to cut the deficit and predicted that they would agree to raise tax rates on the rich to obtain a year-end deal to avoid the "fiscal cliff."

"Right now for both sides it's all about staying firm and determined to go to the very end," said Peter Cardillo, chief market economist at Rockwell Global Capital in New York about the negotiations. "But we all know the stakes are high and (Congress) can't be that stupid as to induce another recession."

Singapore Airlines said it was in talks with interested parties to sell its 49 percent stake in British carrier Virgin Atlantic, with sources saying that Delta Air Lines was among the potential suitors. Delta shares fell 1.9 percent to $9.81.

Dell shares rose 6.3 percent to $10.25 after Goldman Sachs upgraded its view on the stock to "buy" from "sell."




blog comments powered by Disqus
most popular on facebook
talking point on sify finance