Stocks jump after reports of growth
First Posted:
STEPHEN BERNARD and TIM PARADIS AP Business Writers
NEW YORK — The first growth in the service industry in a year and an upgrade of big banks pulled investors into the stock market after a two-week slide.
Major stock indicators rose jumped about 1 percent Monday, including the Dow Jones industrial average, which added 112 points.
The Institute for Supply Management said its service index rose to 50.9 in September from 48.4 in August. Analysts polled by Thomson Reuters had expected a reading of 50, the dividing line between growth and contraction. The index hadn’t grown since August 2008.
Financial and energy stocks led gains after Goldman Sachs raised its rating on large banks and the price of oil jumped.
The advance follows the
first two-week slide since July, which came as reports on manufacturing and consumer sentiment fell short of expectations.
Stocks had fallen for seven of eight days, which likely brought buying interest from investors seeking bargains.
Monday’s advance came as trading volume was light, which can skew price moves. Bigger tests of the market will arrive in the coming weeks when companies begin turning in earnings reports for the July-September quarter.
