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Wall Street rebounds amid Crimean referendum results

English.news.cn   2014-03-18 04:08:09

NEW YORK, March 17 (Xinhua) -- U.S. stocks bounced back Monday from last week's selloff, as Crimean referendum results to secede from Ukraine turned out without much suspense.

The Dow Jones Industrial Average surged 181.55 points, or 1.13 percent, to 16,247.22. The S&P 500 jumped 17.70 points, or 0.96 percent, to 1,858.83. The Nasdaq Composite Index climbed 34.55 points, or 0.81 percent, to 4,279.95.

Brushing aside the overwhelming vote results, the major indices logged the best day since March 4, with a "sell the rumor, buy the fact" reaction.

The Crimean parliament declared independence from Ukraine on Monday, after official results from Sunday's referendum showed 96. 6 percent of Crimeans voted to secede from Ukraine and join Russia.

However, the West has rejected the referendum, calling the vote "illegal" and "contrary to Ukrainian Constitution."

U.S. President Barack Obama on Monday announced sanctions against seven Russian and four Ukrainian officials, who the United States said are responsible for threatening Ukraine's sovereignty and territorial integrity.

Responding positively to the vote results, Wall Street staged a strong rebounding, as the news seemed to have been priced in the market which had seen a pullback on lingering concerns over Ukraine tensions last week.

However, the market gave up part of earlier gains, as obvious risks in Crimea remained, dampening bullish sentiment to a certain extent.

On the economic front, manufacturing activity in the New York region continued to improve in March, according to the Empire State Manufacturing Survey by the Federal Reserve Bank of New York. The general business conditions index registered 5.61 in March, slightly higher than 4.48 in the prior month.

U.S. industrial production increased 0.6 percent in February after having declined 0.2 percent in January, said the U.S. Federal Reserve Monday, beating market expectations.

Furthermore, U.S. builder confidence in the market for newly- built, single-family homes edged up one point to 47 in March, according to the National Association of Home Builders/Wells Fargo Housing Market Index (HMI) released Monday.

"The March HMI mirrors last month's sentiment, as builders continued to be affected by poor weather and difficulties in finding lots and labor," said NAHB Chairman Kevin Kelly in the news release.

Moreover, investors are awaiting the Fed's upcoming two-day policy meeting starting Tuesday, the first with Janet Yellen as chair. Whether the Fed might make a transition from a threshold- based forward guidance to a more qualitative one at the meeting will be of particular interest to the market.

The CBOE Volatility Index, widely considered as a fear gauge of the market, tumbled 12.23 percent to end at 15.64 Monday.

In other markets, oil prices dropped Monday on speculations that Russia is unlikely to disrupt its oil shipment to Europe after Crimea's referendum results.

Light, sweet crude for April delivery moved down 81 cents to settle at 98.08 U.S. dollars a barrel on the New York Mercantile Exchange, while Brent crude for May delivery lost 1.97 dollars to close at 106.24 dollars a barrel.

Gold futures snapped a five-session gaining streak Monday, with the most active gold contract for April delivery down 6.1 dollars, or 0.44 percent, to settle at 1,372.9 dollars per ounce.

The U.S. dollar traded mixed against other currencies Monday following the Crimean referendum. In late New York trading, the euro moved up to 1.3920 dollars from 1.3858 dollars in the previous session. The dollar bought 101.72 Japanese yen, higher than 101.28 yen of the previous session.

Editor: yan
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