US stocks rebound as anxiety over British vote eases - KWWL - Eastern Iowa Breaking News, Weather, Closings

US stocks rebound as anxiety over British vote eases

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By ALEX VEIGA
AP Business Writer

Encouraging data on the U.S. economy and housing market helped put U.S. stock indexes on track for a higher close in late-afternoon trading Tuesday. The broad rebound followed even bigger gains in Europe as global markets recovered from a two-day rout triggered by Britain's vote to leave the European Union.

Oil and gas companies led the rally as energy futures prices rose. Banks and other financial companies, which took the heaviest losses in the sell-off, also surged. Health care, consumer and technology stocks also notched gains. Bond prices fell, sending yields higher.

The Dow Jones industrial average gained 199 points, or 1.2 percent, to 17,339 as of 3:28 p.m. Eastern Time. The Standard & Poor's 500 index rose 27 points, or 1.4 percent, to 2,028. The Nasdaq composite added 81 points, or 1.8 percent, to 4,676.

European benchmarks rose even more. Britain's FTSE 100 and France's CAC 40 each gained 2.6 percent. Germany's DAX added 1.9 percent.

The euro and the British pound were moving higher, though the pound remained near its lowest levels since 1985.

Uncertainty and anxiety over the economic fallout from Britain's vote to leave the European Union has roiled global financial markets since Friday and prompted ratings agencies to slash their top-shelf credit rating for the U.K.

Investors appeared to shake off their some of their jitters Tuesday. British Prime Minister David Cameron has signaled he might not trigger a clause setting in motion the U.K.'s exit from the EU before October.

In the U.S., a new batch of economic data helped put traders in a buying mood.

The Commerce Department raised its estimate of U.S. economic growth in the first three months of the year. Separately, a key gauge of home values showed U.S. home prices climbed in April, hitting record highs in several cities. In addition, the Conference Board said its measure of U.S. consumer confidence increased this month to the highest level since October.

"Obviously, the market isn't very receptive to uncertainty, but in some ways this uncertainty is providing the possibility and the consideration that what happened in the U.K. isn't necessarily reflective of, or an indicator of, a recession, especially here in the U.S. as well as globally," said W. Janet Dougherty, a global investment specialist at J.P. Morgan Private Bank.

Pharmaceutical company Endo International surged 18.8 percent, the biggest gainer in the S&P 500 index. The stock added $2.57 to $16.26.

Xencor vaulted 34.9 percent after the drugmaker announced a partnership with Novartis to develop two cancer drugs. The stock rose $4.36 to $16.90.

Several energy companies also notched gains.

Southwestern Energy climbed $1.48, or 11.9 percent, to $13.90, while Devon Energy added $2.09, or 6.2 percent, to $35.84. Cabot Oil & Gas gained $1.81, or 7.5 percent, to $25.87.

Earlier in Asia, markets bounced back from early losses as leaders signaled they were ready to step in with support policies. Japan's benchmark Nikkei 225 index climbed 0.1 percent, while South Korea's Kospi added 0.5 percent.

Hong Kong's Hang Seng Index was a laggard, losing 0.3 percent. It was dragged down by companies with high exposure to Europe, such as billionaire tycoon's Li Ka-shing's CK Hutchison Holdings, which has British retail, ports and telecom investments and fell 1.7 percent.

"When you pull a spring, after you let it go it oscillates up and down for a little while and that's still what we're seeing in the markets," said Andrew Sullivan, a sales trader at Haitong Securities. "This is nothing about individual companies per se, this is about the effect of forex on their earnings."

In currency markets, the pound recovered to $1.3345 from $1.3176 on Monday. The yen eased slightly against the dollar, though it was still hovering near its strongest level in two years. The dollar rose to 102.74 yen from 101.97 yen. The euro strengthened to $1.1061 from $1.1005.

Benchmark U.S. crude rose $1.52, or 3.3 percent, to close at $47.85 a barrel in New York. Brent crude, used to price international oils, gained $1.42, or 3 percent, to close at $48.58 a barrel in London.

In other energy trading, wholesale gasoline rose 3 cents to $1.51 a gallon. Heating oil added 4 cents to $1.47 a gallon. Natural gas gained 20 cents, or 7.4 percent, to $2.92 per 1,000 cubic feet.

Bond prices fell. The yield on the 10-year Treasury note rose to 1.45 percent from 1.44 late Monday.

In metals trading, gold fell $6.80 to $1,317.90 an ounce, silver rose 10 cents to $17.89 an ounce and copper added 5 cents to $2.18 a pound.

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AP Business Writer Kelvin Chan contributed to this report from Hong Kong.

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