Traders applaud on the floor of the New York Stock Exchange, New York, the United States, on Jan. 2, 2013. The U.S. stocks surged on Wednesday, the first trading day of 2013, as the Congress steered the country off the "fiscal cliff", which had been a major uncertainty hanging over the market. At the close of trading, the Dow Jones Industrial Average rallied 308.41 points, or 2.35 percent, to 13,412.55. The broader S&P 500 Index jumped 36.23 points, or 2.54 percent, to 1,462.42. The tech- heavy Nasdaq Composite Index climbed 92.75 points, or 3. 07 percent, to 3,112.26. (Xinhua/Wang Lei)
The U.S. stocks surged on Wednesday, the first trading day of 2013, as the Congress steered the country off the "fiscal cliff", which had been a major uncertainty hanging over the market.
Late on Tuesday night, the U.S. House of Representatives passed a bill that will increase taxes on individuals earning more than 400,000 U.S. dollars and households more than 450,000 dollars a year, and preserve certain benefits.
The market was greatly boosted in the whole trading session by the news, after having been subdued for weeks by the fiscal gridlock in Washington.
In the last one-hour trading, the main stock indices bounded back strongly surpassing the peak of earlier session.
On the economic front, the ISM Manufacturing Factory Index rose to 50.7 in December from 49.5 a month earlier. A reading above 50 is indicative of expansion. Besides, the employment index in December rose to its highest reading since September.
However, U.S. construction spending inched down 0.3 percent in November, the first decline since March, as steep drop in volatile federal projects offset another gain in home building, according to a report released on Wednesday by the Commerce Department.
Both the two data above seemed to have little effect on the market as it was full of optimism incurred by the ending of the fiscal impasse.
The equity market's rally was extraordinarily broad, with all 10 sectors of the S&P 500 index moving up, led by techs, telecoms and financials.
Bank shares advanced as U.S. regulators were reportedly close to securing another multibillion-dollar settlement with the biggest banks to figure out allegations that they unlawfully took a shortcut when foreclosing on delinquent borrowers.
In terms of stocks, Zipcar jumped 47.8 percent after the world' s largest car sharing and car club service said that it had agreed to be acquired by car rental giant Avis for about 500 million dollars.
At the close of trading, the Dow Jones Industrial Average rallied 308.41 points, or 2.35 percent, to 13,412.55. The broader S&P 500 Index jumped 36.23 points, or 2.54 percent, to 1,462.42. The tech- heavy Nasdaq Composite Index climbed 92.75 points, or 3. 07 percent, to 3,112.26.
Wednesday's gains came after Wall Street ended 2012 on a strong note, with the Dow up 7.3 percent, the S&P rising 13.4 percent and the Nasdaq soaring 15.9 percent. Stock markets around the world also rose on Wednesday, propelled by the end of the U.S. "fiscal cliff" worries.
Commodities also rose as the budget deal spurred investors' appetite for riskier assets. U.S. crude for February delivery gained 1.42 percent to settle at 93.12 dollars a barrel on the New York Mercantile Exchange. Brent crude for February delivery was up 1.22 percent to close at 112.47 dollars a barrel.
Gold prices rallied nearly 1 percent, touching a two-week high.
However, the dollar, broadly considered safe harbor, retreated against major currencies.
Investors were still keeping a close watch on responses from credit rating agencies since spending cuts and debt ceiling of the United States were still left unresolved which may weigh on the market in the next couple of months.
