New York – A turnaround in personal spending and a flurry of acquisition activity sent stocks higher Monday, but it wasn’t enough to salvage a topsy-turvy month. The major indexes fell in October.
A Commerce Department report showing spending rose 0.5 percent in September – reversing a 0.5 percent decline the month before – came as another sign of the economy’s resilience after Hurricanes Katrina and Rita. Last week, the department reported better-than-expected 3.8 percent gross domestic product growth for the July-September quarter.
While the upswing in spending bolstered the retail and technology sectors, Steven Goldman, chief market strategist at Weeden & Co., also linked Monday’s rally to a broad recovery from last week’s lows and typical end-of-the-month trading as hedge funds and mutual funds try to boost returns. He also cited strong gains in the European markets.
“Basically we had market sentiment get a bit too one-sided,” Goldman said about recent down days on Wall Street. “Stocks were getting in place to rebound.”
The Dow Jones industrial average rose 37.30, or 0.36 percent, to 10,440.07, after adding as much as 83 points late in the session.
The Bloomberg Colorado Index, a price-weighted list of companies based in the state, gained 3.63, or 1.2 percent, to close at 301.75.
Broader stock indicators were also higher. The Standard & Poor’s 500 index was up 8.60, or 0.72 percent, at 1,207.01, and the Nasdaq composite index surged 30.42, or 1.46 percent, to 2,120.30.
Bonds advanced, with the yield on the 10-year Treasury falling to 4.55 percent from 4.57 percent late Friday. The dollar was mixed against most major currencies, while gold prices inched upward.
Wall Street finished October lower despite back-to-back trading days of sharp gains, closing out an erratic month when investors sold stocks on seemingly any data hinting at a slowing economy or a whiff of inflation. On Friday, the Dow climbed almost 173 points, its biggest one-day leap since late April.
For the month, the Dow fell 1.22 percent.
