Wall Street rises with oil, investors shrug off Italy referendum
Financial shares and strong oil prices bolstered US stocks yesterday while currency and bond investors shrugged off Italian Prime Minister Matteo Renzi’s resignation, following voters’ rejection of his constitutional reforms.
The Italian referendum stoked worries about Italy’s political stability and its banking system, but US Treasury yields reversed their fall as the initial demand for low-risk US government debt faded with a euro and stock price revival.
“The initial reaction was quite negative, but as we have seen recently with other political events, risks will likely be played out over a period of time,” said Brian Daingerfield, macro strategist at NatWest Markets in Stamford, Connecticut.
US stocks rose as the S&P 500 banking index erased Friday’s losses with a 1.7 per cent jump and its energy index jumped one per cent as oil futures rose.
The Dow Jones industrial average was up 84.64 points, or 0.44 per cent, to 19,255.06, the S&P 500 gained 14.76 points, or 0.67 per cent, to 2,206.71 and the Nasdaq Composite added 51.83 points, or 0.99 per cent, to 5,307.49.
Benchmark 10-year Treasury note yield was up four basis points at 2.429 per cent, while the 30-year bond yield...