NEW YORK (AP) — The latest on the global financial market turmoil (all times local):
Stocks stay higher in the U.S. after a report shows that Americans stepped up their purchases of new homes in July, with sales surging in the Northeast.
The Commerce Department says new-home sales rose 5.4 percent last month to a seasonally adjusted annual rate of 507,000, recovering from a slide in purchases in June.
All 10 sectors in the S&P 500 index are higher, led by gains for technology stocks.
U.S. stocks jumped at the open after China’s central bank cut interest rates to support its economy.
The Dow Jones industrial average rose 296 points, or 1.9 percent, to 16,180.61, as of 9:45 a.m. Eastern time. The Standard & Poor’s 500 index climbed 38 points, or 2 percent, to 1,932. The Nasdaq composite rose 109 points, or 2.4 percent, to 4,635.
Oil prices are up, but U.S. crude is still trading below $40 a barrel.
Treasury notes are falling, pushing up the yield on the 10-year benchmark not to 2.08 percent.
Best Buy was the biggest gainer in the S&P 500 index. The stock surged 16.4 percent after its fiscal second-quarter results handily beat analysts’ estimates as shoppers picked up major appliances, large screen televisions and mobile phones
China’s interest rate cuts will not be enough to ease concerns about the country’s economy, says Kamel Mellahi, professor at Warwick Business School in Britain.
“The Chinese economy is going to be on this bumpy road for a while and it will have ebbs and flows that will no doubt have a serious impact on the global economy,” he says.
The Chinese central bank cut its key interest rate and deposit rate on Tuesday after its main stock market plunged for a fourth day. The move boosted markets around the world.
Mellahi says that while the rate cuts may buoy markets in the short-term, the underlying causes of investors’ concerns – the slowdown in the Chinese economy – will last for some time.
Wall Street futures are rallying further after China’s central bank cut interest rates to support its economy.
Dow futures are up 600 points, or 3.8 percent, while the broader Standard & Poor’s 500 futures are up 72.8 points, or 3.9 percent.
The jump follows a stomach-churning day on Monday, when the Dow plunged more than 1,000 points at one point before finishing down 588.40 points, or 3.6 percent. The Standard & Poor’s 500 index slid 77.68 points, or 3.9 percent, into “correction” territory – jargon for a drop of at least 10 percent from a recent peak. The last market correction was nearly four years ago.