US stocks closed higher on Monday, shrugging off troubles in the eurozone and worries about a possible Greek default to stage a healthy rebound.
The Dow Jones Industrial Average rose 68.99 points (0.63 per cent) to close at 11,061.12. The broader S&P 500 climbed 8.04 points (0.70 per cent) to 1,162.27, while the tech-heavy Nasdaq Composite rallied 27.10 points (1.10 per cent) to 2,495.09.
US stocks plunged about one per cent as markets opened, following sharp losses on European exchanges, then bounced up and down and finally made a spectacular rally in the last few minutes of trading.
“It wasn’t as bad as we thought when the day started,” said Hugh Johnson, head of Hugh Johnson Advisors. “There are ongoing worries about the global economy, there are ongoing worries about Greece and the eurozone, there are ongoing worries about US fiscal policy.
“They are not behind us, but the key question that investors are trying to answer is: is it just a slowdown in the economy or something more serious? And they are slowly coming to the conclusion it may only be a slowdown.”
Financial stocks were up, with Bank of America climbing 1.0 per cent after saying it would eliminate 30,000 jobs as part of a broad restructuring plan that would cut $US5 billion from its annual costs by 2014.
JPMorgan Chase gained 1.1 per cent, Goldman Sachs rose 0.7 per cent and Citigroup was up 0.8 per cent.
Media conglomerate McGraw-Hill jumped 4.0 per cent after announcing that it would split into two companies, one to focus on publishing and one to hold its market-analysis businesses, including the Standard & Poor’s ratings agency.
Shares of chipmaker NetLogic soared 50.8 per cent after the announcement that it would be acquired by semiconductor manufacturer Broadcom in a $US3.7 billion deal. Broadcom’s shares slumped 1.1 per cent.
Berkshire Hathaway, billionaire Warren Buffett’s investment company, rose after the octogenarian tycoon chose hedge-fund manager Ted Weschler, 50, to join a team that will eventually succeed Buffett at the helm.
Berkshire’s broadly-traded class B shares gained 2.2 per cent.
Bond prices were almost unchanged. The yield on the 10-year Treasury note rose to 1.93 per cent from 1.92 per cent late Friday, while that on the 30-year bond slipped to 3.24 per cent from 3.25 per cent.
Bond prices and yields move in opposite directions.
