By Wallace Witkowski and Anora Mahmudova, MarketWatch
Energy shares hit as oil slides more than 3%
U.S. stocks traded higher Tuesday, with the Dow industrials
rising more than 100 points, boosted in part by the outcome of the
presidential debate between Democratic candidate Hillary Clinton
and Republican contender Donald Trump and a number of
stronger-than-expected economic reports.
The advance in stocks suggests that U.S. equity markets are
betting that Clinton benefited the most from Monday's presidential
debate. Stocks are rising at the prospect of a Clinton presidency
because the Democrat is viewed as a known quantity while some view
Trump as being more unpredictable -- a bad thing for stock
investors.
"Investors have a better idea about policies of Hillary Clinton,
so any sign she is closer to the presidency is a boost for
markets," said Diane Jaffee, senior portfolio manager at TCW.
The Dow Jones Industrial Average gained 135 points, or 0.7%, to
18,230, led by gains in shares of Microsoft Corp.(MSFT),
International Business Machines Corp.(IBM) and Cisco Systems
Inc.(CSCO) with 28 out of 30 of the blue-chip companies trading
higher.
The S&P 500 index rose 14 points, or 0.6%, to 2,160. Tech
and consumer-discretionary shares led the gainers, while utilities
were down 0.9% and energy was down 0.6% thanks to a slide in oil.
The Nasdaq Composite Index was up 44 points, or 0.8%, to 5,302.
Oil futures tumbled more than 3%
(http://www.marketwatch.com/story/oil-prices-lower-after-iran-douses-hopes-for-production-deal-2016-09-27)
after both Iran and Saudi Arabia played down expectations for a
deal to freeze or cut oil production at the closely watched
informal OPEC meeting on Wednesday.
Additionally, U.S. consumer confidence
(http://www.marketwatch.com/story/consumers-the-most-confident-since-2007-2016-09-27)rose
to 104.1 in September, the highest level since August 2007.
"Debate performance gave investors a little more confidence
about this election, and I think today's move came as consumer
confidence came in better than expected," said Robert Pavlik, chief
market strategist at Boston Private Wealth. "I think that's what's
behind [higher stocks] given that oil is down."
Analysts noted that worries over Deutsche Bank and other
European banks
(http://www.marketwatch.com/story/how-deutsche-bank-woes-are-stressing-out-the-us-stock-market-2016-09-26)
also continue to rattle investor nerves.
Read:Deutsche Bank debt is taking a beating
(http://www.marketwatch.com/story/deutsche-bank-debt-is-taking-a-beating-2016-09-27)
"Some investors are wondering if Deutsche Bank troubles may turn
into a Lehman scenario and that's putting pressure on European
equities," Mark Kepner, managing director of sales and trading at
Themis Trading, referring to Lehman Brothers, which went bankrupt
Sept. 15, 2008 and signaled the height of the financial crisis.
(http://www.marketwatch.com/story/deutsche-bank-debt-is-taking-a-beating-2016-09-27)Read:At
debate, Trump and Clinton clash on how to remake the economy
(http://www.marketwatch.com/story/how-trump-and-clinton-want-to-remake-the-economy-2016-09-26)
However, the main focus early for investors was Monday night's
presidential debate and how it could influence the direction of the
economy and the global market.
"The perception on Wall Street is that [Clinton] would be the
safer pair of hands, but with two further debates and six more
weeks of campaigning to go, this race seems set to be a bountiful
source of market volatility in the near term," Paul Webb, deputy
CEO at ADS Securities London, in a note.
Mexico wave: In another sign suggesting financial markets
(http://www.marketwatch.com/story/financial-markets-say-clinton-beat-trump-in-the-debate-2016-09-26)
were betting that Clinton would benefit from the debate, the
Mexican peso surged against the dollar on Tuesday. The greenback
fell to 19.449 pesos, down from 19.879 pesos late Monday in New
York.
The peso has been acting as a gauge of the presidential election
sentiment on the theory that a victory for Trump will at the very
least result in less trade between the two countries, if not the
building of a barrier on the U.S. southern border.
The U.S. Dollar Index , a measure of the buck's strength against
a basket of six key rivals, was up 0.2% at 95.46.
Economic docket: The Case-Shiller home price index rose 5.0% for
the year in July, while house prices rose 0.6%.
The Markit flash services purchasing managers index for
September rose to 51.9 in September from 51 in August.
Stocks to watch: U.S.-listed shares of Deutsche Bank AG(DBK.XE)
ticked 0.4% higher after the U.S. Justice Department's third
highest-ranking official said banks can lower penalties
(http://www.marketwatch.com/story/deutsche-bank-shares-turn-positive-after-justice-department-comments-2016-09-27)
by cooperating with authorities, according to a news report.
Shares of Royal Caribbean Cruises Ltd.(RCL) and Carnival
Corp.(CCL) led S&P 500 gainers a day after Carnival raised its
outlook for the year
(http://www.marketwatch.com/story/carnival-lifts-guidance-as-profit-rises-17-2016-09-26).
(http://www.marketwatch.com/story/how-deutsche-bank-woes-are-stressing-out-the-us-stock-market-2016-09-26)Shares
of EndoChoice Holdings Inc.(GI) soared 89% to $7.98 after Boston
Scientific Corp. (BSX) said it would buy the medical technology
company for roughly $210 million
(http://www.marketwatch.com/story/boston-sci-to-buy-endochoice-for-210-million-2016-09-27).
(http://www.marketwatch.com/story/how-deutsche-bank-woes-are-stressing-out-the-us-stock-market-2016-09-26)FactSet
Inc.(FDS) plunged 5.6%, even after posting a rise in earnings and
revenue
(http://www.marketwatch.com/story/factset-profit-and-revenue-rise-2016-09-27)
in its fiscal fourth quarter.
Kite Pharma Inc.(KITE) surged 8.8% after the drugmaker late
Monday released encouraging test results for its for its
non-Hodgkin lymphoma drug.
Nike Inc.(NKE) will report earnings after the market's close
(http://www.marketwatch.com/story/what-to-watch-for-in-nike-earnings-2016-09-23).
Shares were up 1.3%.
Other markets: Stocks in Europe eked out last minute gains
(http://www.marketwatch.com/story/european-stocks-slide-as-us-debate-cheer-fades-2016-09-27)
as oil's slide dragged on the energy sector. In Asia, shares
reversed earlier declines as investors reacted to the U.S.
presidential debate
(http://www.marketwatch.com/story/asian-shares-turn-mostly-higher-in-wake-of-us-presidential-debate-2016-09-27),
with the Nikkei Stock Average closing up 0.8%.
Gold futures
(http://www.marketwatch.com/story/gold-silver-lose-haven-bid-in-the-wake-of-the-presidential-debate-2016-09-27)
settled down 1% at $1,330.40 an ounce.
--Carla Mozee and Sara Sjolin in London contributed to this
article.
(END) Dow Jones Newswires
September 27, 2016 14:19 ET (18:19 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.