U.S. stocks rose on Tuesday, with the S&P 500 on track for a sixth straight session of gains as an alternative solution emerged to the Syrian crisis that could avert a possible Western military strike.
Encouraging economic data from China gave investors further reason to buy, with nine of the 10 S&P sectors higher. Energy was the only exception, falling alongside crude oil.
Fears of action against Syria eased after U.S. President Barack Obama said Monday he saw a possible breakthrough in the situation after Russia proposed that Syria hand over its chemical weapons for destruction, a proposal Syrian Prime Minister Wael al-Halki said his country supported.
While such a move could avert a potential Western-led military strike, the White House said Obama would press ahead with his plan to ask Congress to approve the use of military force against the country.
“We don’t know if this is just talk or if it could happen, but right now tensions have cooled and the market likes that,” said Michael Matousek, head trader at U.S. Global Investors Inc in San Antonio.”
Geopolitical uncertainty has driven market movement in recent weeks, with investors especially watching global oil prices for any sign that military action could constrain supply. Crude fell 2.2 percent.
The Dow Jones industrial average was up 97.71 points, or 0.65 percent, at 15,160.83. The Standard & Poor’s 500 Index was up 9.75 points, or 0.58 percent, at 1,681.46. The Nasdaq Composite Index was up 17.65 points, or 0.48 percent, at 3,723.83.
After its worst monthly performance since May 2012 in August, the S&P has rallied 3.1 percent over the past six sessions, its longest winning streak since early July.
Apple Inc is expected to introduce a cheaper version of the iPhone on Tuesday, bringing one of the industry’s costliest smartphones within reach of the masses in poorer emerging markets. Apple fell 0.7 percent at $502.48.
Economic data in China showed stronger-than-expected industrial output while retail sales grew at the fastest pace this year, reinforcing signs that the world’s second-largest economy was stabilizing after slowing for more than two years. On Monday, Wall Street had climbed following strong Chinese export data.
S&P Dow Jones Indices announced the biggest shake-up for the Dow Jones Industrial Average in almost a decade, with Goldman Sachs Group Inc , Visa Inc and Nike Inc replacing Bank of American Corp ,Hewlett-Packard Co and Alcoa Inc , respectively. The changes will take effect on September 23.
Goldman rose 3.4 percent to $164.96 while Visa gained 3 percent to $183.99 and Nike advanced 1.5 percent to $66.36. Alcoa lost 0.4 percent to $8.05, Bank of America added 1.2 percent to $14.66 and Hewlett-Packard shed 0.6 percent to $22.22.
“We’re not making any moves on the changes, but some market players will try and trade off the ones being added, attempting to get ahead of fund rebalancing,” said Matousek, who helps oversee about $1.3 billion. “Over the long term, this shouldn’t skew those names one way or the other.”
McDonald’s Corp gained 0.7 percent to $97.08 after the fast-food restaurant chain reported a better-than-expected 1.9 percent increase in global sales at established restaurants in August.
Urban Outfitters Inc slumped 11 percent to $38.14 after Janney Montgomery Scott cut its price target on the stock to $46 from $52!!