Saturday, April 13, 2024

Major indexes open broadly higher; GameStop, AMC crumble

by Associated Press

Major indexes are opening broadly higher, while GameStop and other stocks that have been on wild swings recently turned sharply lower. The S&P 500 added 1.2% in the early going Tuesday, building to its gains from a day earlier. GameStop sank 40% in the early going in its latest bout of extreme volatility, and AMC Entertainment fell nearly as much. Big Tech companies were among the earlier winners, as were several energy companies including Exxon Mobil and Marathon Petroleum, both of which reported better quarter results than analysts were expecting. UPS rose after reporting record revenue. Treasury yields rose, as did crude oil prices.

Global stocks followed Wall Street higher Tuesday after President Joe Biden invited Republicans to a meeting to discuss economic aid, while silver eased off an eight-year high.

London and Frankfurt opened higher. Shanghai, Tokyo and Hong Kong also advanced.

U.S. futures rose a day after Wall Street’s benchmark S&P 500 index gained 1.6% amid frenzied trading of video game retailer GameStop and other stocks targeted by novice day traders.

In Washington, Biden invited 10 moderate Republicans to the White House to discuss his proposed $1.9 trillion economic aid plan. Republicans earlier countered with an offer of $600 billion, or less than one-third of Biden’s proposed amount.

“The sound of more stimulus, which tends to raise all boats, was music to the market’s ears,” said Stephen Innes of Axi in a report.

In early trading, the FTSE 100 in London rose 0.2% to 6,481.54 and Frankfurt’s DAX opened up 0.8% at 13,729.33. The CAC 40 in Paris gained 1.2% to 5,529.47.

On Wall Street, futures for the S&P 500 index and Dow Jones Industrial Average were up 0.7%.

On Monday, the Dow rose 0.8%. The Nasdaq composite climbed 2.5%.

U.S. markets have been roiled by trading in GameStop and some other stocks that had been expected to decline but surged after novice traders bought. Other investors said hedge funds that bet against those stocks were losing money and selling other shares.

GameStop slumped 30.8% to $225 a share. It ended last year at about $18.

Tech stocks led the way higher. Communication stocks and a variety of companies that rely on direct consumer spending such as Starbucks and AutoZone helped lift the market.

The price of silver retreated from an eight-year high. Silver for March delivery sank $1.43, or 4.9%, to $27.96 per ounce.

Last week, messages on social media encouraged small investors to buy silver. It shot up Monday, but many online investors said it wasn’t them bidding up the price.

Smaller traders are learning “the silver market is much bigger than some of the small cap stocks they have been trading,” said Edward Moya of Oanda in a report. “Silver coin purchases and call option bets are not enough of a driver to send silver prices skyrocketing to record high levels.”

In Asia, the Shanghai Composite Index rose 0.8% to 3,533.68 and the Nikkei 225 in Tokyo advanced 1% to 28,352.17. The Hang Seng in Hong Kong added 2.1% to 29,248.70.

The Kospi in Seoul was up 1.3% to 3,096.81 and India’s Sensex added 2.4% to 49,753.85.

Sydney’s S&P-ASX 200 gained 1.5% to 6,762.60 after Australia’s central bank left its key interest rate unchanged at 0.1% and extended a bond purchase program through September. The bank said the job market exceeded expectations.

New Zealand and Jakarta retreated while Singapore and Bangkok rose.

Investors bid up stocks heading into 2021 in expectation the rollout of coronavirus vaccines would allow global business and travel to return to normal. That optimism has been dented by infection spikes and disruptions in vaccine deliveries.

In energy markets, benchmark U.S. crude rose 84 cents to $54.39 per barrel in electronic trading on the New York Mercantile Exchange. The contract gained $1.35 on Monday to $53.55 a barrel. Brent crude, used to price international oils, added 80 cents to $57.15 per barrel in London. It advanced $1.31 the previous session to $56.35.

The dollar declined to 104.87 yen from Monday’s 104.94 yen. The euro rose to $1.2084 from $1.2066.

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