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Wall Street soars on hopes of fiscal agreement


http://en.youth.cn   2013-10-17 14:23:00

  NEW YORK, Oct. 16 (Xinhua) -- U.S. stocks closed sharply higher Wednesday on growing expectations that the U.S. House would approve a Senate deal to end the government shutdown and avert an imminent potential debt default.

  The Dow Jones Industrial Average leapt 205.82 points, or 1.36 percent, to 15,373.83 points. The S&P 500 surged 23.48 points, or 1.38 percent, to 1,721.54 points. The Nasdaq Composite Index rallied 45.42 points, or 1.20 percent, to 3, 839.43 points.

  White House Spokesman Jay Carney said on Wednesday afternoon that U.S. President Barack Obama supports the Senate debt deal, after Senate leaders reached an agreement to break the fiscal stalemate in Washington.

  U.S. House Speaker John Boehner also reportedly said the House won't block the Senate agreement, adding that he wants the government to reopen Thursday.

  The Senate is expected to vote on the deal Wednesday night to be followed by a vote in the House.

  The Treasury has made it clear that extraordinary measures will be exhausted by Oct. 17, and failure to raise the debt ceiling would lead to a catastrophic default.

  After the stock market closed on Tuesday, Fitch Ratings placed the AAA credit rating of the United States on rating watch negative, saying delays of lifting the debt ceiling would cause volatility and damage U.S. credit-worthiness.

  Billionaire Warren Buffett told CNBC Wednesday that the threat to not raise U.S. debt limit is a "political weapon of mass destruction."

  He also noted that dollar is not in danger as a reserve currency, though maybe in future, but added that there is no reason not to buy stocks despite political stalemate in Washington.

  On the economic front, U.S. builder confidence in the market for newly built, single-family homes fell two points in October from the prior month, according to the Housing Market Index released jointly by the National Association of Home Builders and Wells Fargo.

  Moreover, the U.S. economic activity continued to expand at a modest to moderate pace during the reporting period of September through early October, the Federal Reserve said Wednesday in its " Beige Book."

  On corporate earnings, Bank of America Corp. on Wednesday reported better-than-expected earnings in the third quarter of 2013, adding positive momentum to the market.

  Shortly after the closing bell, IBM beat market consensus in its third quarter earning, but missed analysts' forecasts in revenues. American Express also posted its quarterly earnings and revenues, both of which exceeded Wall Street expectations.

  In other markets, the U.S. dollar traded mixed against major currencies Wednesday following the Senate deal. The greenback initially strengthened against most of its peers on growing market confidence that the Senate deal will pass both chambers, but later surrendered its earlier gains on profit taking.

  In late New York trading, the euro inched up to 1.3533 dollars from 1.3519 of the previous session. The dollar bought 98.74 Japanese yen, higher than 98.31 yen of the previous session.

  Oil prices rebounded on growing hopes of a fiscal deal. Light, sweet crude for November delivery increased 1.08 dollars to settle at 102.29 dollars a barrel on the New York Mercantile Exchange, while Brent crude for November delivery gained 90 cents to close at 110.86 dollars a barrel.

  Gold futures on the COMEX division of the New York Mercantile Exchange on Wednesday closed at near a one-week high. The most active gold contract for December delivery rose 9.1 dollars, or 0. 71 percent, to settle at 1,282.3 dollars per ounce.

 
source : Xinhua     editor:: Liao Shuman
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