Wall Street continued to rebound on Monday afternoon, snapping a three-session losing run, paced by energy shares amid bets that any fallout from Friday’s terrorist assaults in the French capital Paris would have a limited economic impact.
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All of the 10 major S&P sectors rose, led by telecom and energy stocks, although companies linked to travel and leisure took a hit.
US equity futures opened lower on Sunday, following coordinated attacks in Paris on Friday that killed more than 130 people.
Even crude oil, usually extremely sensitive to geopolitical threats that could disrupt supply, initially failed to rally. Goldman was up 0.9 percent.
The broad-based S&P 500 added 3.73 (0.18 percent) at 2,026.77, while the tech-rich Nasdaq Composite Index gained 0.48 (0.01 percent) at 4,928.36.
The Stoxx Europe 600 rose 0.3%.
Tourism stocks were generally lower on expectations of lower traffic due to the attacks.
US and European stocks had seen steady gains in October following an August selloff, but dropped sharply last week amid a fall in commodities prices and as investors braced for the Federal Reserve to raise interest rates in December. Dow e-minis were down 23 points, or 0.13 percent, with 37,225 contracts changing hands. Marriott rose 1.35 percent.
“We have our own issues going on with the Fed and rates and the USA economy and that’s causing key asset managers to sit tight a little bit, ” said Kenny Polcari, director at O’Neil Securities, adding that trading volumes were light. Aeroports de Paris was down 3.7 per cent, while Deutsche Lufthansa and British Airways parent global Consolidated Airlines Group were down 2.3 per cent and 2.8 per cent, respectively.
American Airlines dropped 1.43%, United Continental 1.22% and Delta Airlines 2.16%. Japan’s benchmark Nikkei tumbled by 1.6 percent, plunging by more than 300 as Tokyo’s trading day got underway.
In deal news, Starwood Hotels fell 3.63% after agreeing to be bought by Marriott worldwide for $12.2 billion, or $72.08 per share. On the Nasdaq, 1,555 issues fell and 1,077 advanced. A few investors said the euro also weakened against the dollar as the attacks may give the European Central Bank more reason to boost its stimulus program.
Since World War II, the USA equity markets have been tested by all manner of shocks to the system, with most downturns seeing relatively speedy recoveries.
And the September 2001 terror attacks saw the S&P lose 4.9% immediately, and experience a total drop of 11.6% over 11 days.
Monday’s moves came after Wall Street snapped a six-week winning streak on Friday, as weak earnings and economic data weighed on retail shares.
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The rout is expected to continue in the USA, as Dow index futures were down nearly 150 points on Monday morning.
