Stocks Kick Off 2013 on a Strong Note
Stocks began 2013 with a bang as all three major indexes rallied after Congress passed a bill that averted the fiscal cliff.
Stocks rallied after lawmakers, late Tuesday, passed a bill that delayed spending cuts by two months and made Bush-era tax cuts permanent for middle class families, while raising taxes on individuals earning over $400,000 and couples earning over $450,000 from 35% to 39.6%. The deal came after nearly two months of negotiations. Although the last-minute deal has been cheered by investors, there are still many unresolved issues which could keep investors on the edge over the next two months.
Investors’ sentiment was also lifted by better than expected manufacturing data. A report from the Institute of Supply Management showed that manufacturing activity rose to 50.7 in December, beating forecasts of a reading of 50.3. A report from the Commerce Department, meanwhile, showed that construction spending fell 0.3% in November to an annual rate of $866 billion. Economists were expecting construction spending to rise 0.6%.
All sectors in the S&P 500 managed to finish the day in green. Technology sector was the best performer in the S&P 500 today, ending the 3.22% higher. Basic Materials sector ended the day 2.49% higher, while Energy sector ended the day 2.04% higher. Financials rose 2.76% in trading today.
Among the major gainers in trading today were Zipcar Inc. (NASDAQ: ZIP), which ended the day 47.82% higher at $12.18, Facebook Inc. (NASDAQ: FB), which ended the day 5.19% higher at $28, and Apple Inc. (NASDAQ: AAPL), which ended the day 3.17% higher at $549.03.
European markets also rallied earlier today, with the FTSE 100 Index closing 2.20% higher, and the CAC 40 Index in Paris closing 2.55% higher. Asian markets also rose sharply overnight, with the Hang Seng Index in Hong Kong closing 2.89% higher.