By Kate Gibson, MarketWatch
NEW YORK (MarketWatch) -- U.S. stocks gained on Tuesday, with
the S&P 500 continuing its longest stretch of gains since
mid-July, after upbeat data from China and amid heightened
diplomacy on Syria.
"The market is happy we're not going to have to go in and shoot
missiles," said JJ Kinahan, chief strategist at TD Ameritrade in
Chicago. "And now we're in spitting distance of 1,700; we may go up
and test that over the next few days," he said of the S&P 500
Index (SPX).
Extending gains into a sixth consecutive session, the index rose
10.01 points, or 0.6%, to 1,681.72, with industrials and financials
leading gains and energy the sole laggard among its 10 major
industry groups.
The Dow Jones Industrial Average (DJI) rose as many as 119
points, and was more recently up 109.08 points, or 0.7%, at
15,172.20.
The Nasdaq Composite (RIXF) climbed 16.23 points, or 0.4%, to
3,722.41.
After a two-session runup, Apple Inc. (AAPL) fell 2% as the
consumer-technology company announced its new flagship iPhone 5S,
along with a less costly, but colorful iPhone 5C. Follow streaming
coverage of Apple.
"I would say the real summary is 'buy the rumor, sell the news'
as the stock is up almost 10% over the last month," said
Kinahan.
For every five shares falling, more than nine gained on the New
York Stock Exchange, where 425 million shares traded as of 2:50
p.m. Eastern.
Composite volume neared 2.5 billion.
"The markets are right now breathing a sigh of relief that we're
moving closer to a diplomatic solution as opposed to a military
solution in Syria," said Darrell Cronk, regional chief investment
officer for Wells Fargo Private Bank. "Any military solution would
cause some angst" by creating uncertainty as to its scale and
duration, Cronk said.
Tuesday's developments included a French plan to submit a
Russian-backed proposal to confiscate Syria's chemical arms to the
United Nations, with Interfax reporting the regime in Syria had
said it would go along with the plan.
President Barack Obama was scheduled to detail his plans
regarding Syria in a nationally televised address scheduled for 9
p.m. Eastern.
"Overnight, we had really strong economic data out of China,
both their industrial production numbers and their retail-sales
numbers were up double digits over year-ago numbers. That has Asian
markets up nicely," Cronk added of reports from Beijing's National
Bureau of Statistics.
The data had China's industrial output rising 10.4% in August
from a year ago and retail sales gaining 13.4%. Wall Street
finished higher on Monday after China reported exports growth that
surpassed expectations.
Equities are benefitting amid an "asset redeployment as people
get out of their gold positions," said Kinahan at TD Ameritrade.
"Gold is probably selling off today and yesterday on Syria news.
Gold, oil and the U.S. dollar tend to be affected by geopolitical
risk," said Cronk at Wells Fargo.
Gold futures (GCZ3) slid $22.70, or 1.6%, to $1,364 an ounce,
while the price of crude (CLV3) fell $2.13, or 1.9%, to $107.39 a
barrel and on the New York Mercantile Exchange.
The dollar (DXY) gained against the currencies of major U.S.
trading partners and Treasury prices fell, with the yield on the
10-year note (10_YEAR) up four basis points to 2.960%.
In coming weeks, the Dow industrials are in for a dramatic
makeover.
As of the open on Sept. 23, Goldman Sachs Group Inc. (GS) will
replace Bank of America Corp. (BAC), Visa Inc. (V) is evicting
Hewlett-Packard Co. (HPQ), and Nike Inc. (NKE) will bump Alcoa Inc.
(AA), S&P Dow Jones Indices said on Tuesday.
"You've replaced two stocks that essentially don't matter in
Alcoa and Bank of America with two that do," said Dan Greenhaus,
chief market strategist at BTIG LLC.
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