NEW YORK (
) -- The Dow Jones Industrial Average and S&P 500 rose today, rebounding after President Barack Obama spoke to top business leaders and made a YouTube push to pass his budget proposal. A big drop in
shares dragged down the Nasdaq.
China's new leadership spoke of supportive measures for the Chinese economy, helping stocks worldwide. Earlier in the day, all three indices were trading in the red.
Obama addressed the Business Roundtable, a group of CEOs, about White House budget plans. He indicated to Republicans that he would refuse to let the tax-and-spending fight in the "fiscal cliff" talks to block raising the debt ceiling in early 2013. "I will not play that game," he said.
Prior to Obama's speech, Stephen Guilfoyle, U.S. economist at Meridian Equity Partners, had said that "when this president speaks, traders tend to sell while he's speaking. The market swoons, and when he's done, the market buys back their shares."
Dow Jones Industrial Average
closed up 83 points, or 0.64%, to 13,034. The blue-chip index, which has risen in four of the past six days, began the session up more than 6% in 2012.
Breadth was positive, with winners outnumbering losers 22 to seven. Top gainers included
Bank of America
Travelers shares jumped 4.9% after the provider of property-casualty insurance said it intends to resume repurchases of its common shares. The company also said its preliminary estimate of net losses relating to Storm Sandy is about $650 million.
shares gained 0.6% as the entertainment giant and
agreed on Tuesday to
. Netflix shares slid 3.8%.
The top decliners included
added 2 points, or 0.16%, to 1,409. The
was off by 23 points, or 0.77%, at 2,974, as Apple shares tumbled 6.4% on reports of a
at one clearing firm and concerns over component supplies falling next year.
The strongest sectors in the broad market were financials, energy, transportation and conglomerates. The weaker sectors were consumer-cyclicals and technology.
Volumes totaled 4.15 billion shares on the New York Stock Exchange and 1.79 billion shares on the Nasdaq. Advancers edged past decliners by a ratio to 1.1-to-1 on the Big Board. Losers beat winners by a 1.3-to-1 ratio on the Nasdaq.
"The fiscal cliff is serious, but it is merely a symptom of a greater underlying economic quagmire," said Jeffrey Sica, manager of SICA Wealth Management. "The economy has failed to achieve sustainable growth to support this year's stock appreciation. The uncertainty created by this quagmire will create anxious investors, and anxious investors eventually become sellers."
Before the market open, Automatic Data Processing's employment report showed an addition of 118,000 jobs in the U.S. in November, less than a downwardly revised 157,000 in October as Hurricane Sandy "wreaked havoc" on the job market, slicing an estimated 86,000 jobs from payrolls, the report said.
Economists were expecting an addition of 125,000 jobs.
The manufacturing, retailing, leisure and hospitality, and temporary-help industries were hit particularly hard by the storm, according to the report.
"Abstracting from the storm, the job market turned in a good performance during the month," said Mark Zandi, chief economist of Moody's Analytics, in a press release. "This is especially impressive given the uncertainty created by the Presidential election and the fast-approaching fiscal cliff. Businesses appear to be holding firm on their hiring and firing decisions."
The ISM Non-Manufacturing Index showed an increase to 54.7 in November from 54.2 in October, indicating continued growth at a slightly faster rate in the non-manufacturing sector. The consensus called for a print of 53.5.
However, the employment index in the ISM report decreased by 4.6 points to 50.3, pointing to growth in employment for the fourth straight month but at a slower rate.
The Census Bureau reported that factory orders rose 0.8% in October after increasing by a downwardly revised 4.5% in September. Economists were expecting the report to come in flat.
The Bureau of Labor Statistics said that nonfarm labor productivity in the third quarter rose 2.9% after the previously reported increase of 1.9%. Economists predicted a 2.7% rise.
In advance of China's central economic planning talks this month, the new Chinese Communist Party chief, Xi Jinping, said more infrastructure investment, tax reform and giving the market a greater role in setting prices were among the top issues to address. Also, China's regulators said they have eradicated a rule limiting insurers' investments in commercial banks.
Premier-in-waiting Li Keqiang recently said urbanization would be one of the biggest engines of Chinese economic growth over the next decade.
Gold for February delivery shed $2 to settle at $1,693.80 an ounce at the Comex division of the New York Mercantile Exchange, while January crude oil contracts fell 62 cents to settle at $87.88 a barrel.
The benchmark 10-year Treasury climbed 4/32 to dilute the yield to 1.595%. The dollar was up 0.18%, according to the
In corporate news,
shares plunged 16% after the mining giant said it is acquiring
Plains Exploration & Production
in transactions totaling $20 billion.
Freeport will acquire Plains for about $6.9 billion in cash and stock and McMoRan for roughly $3.4 billion in cash, or $2.1 billion net of 36% of the McMoRan interests currently owned by Freeport and Plains. Upon closing, McMoRan Exploration shareholders will also receive a distribution of units in a royalty trust.
Plains shares soared 23% and McMoRan Exploration shares jumped 87%.
shares tacked on 6.3% as the company announced that it is taking a series of "repositioning actions," which includes a reduction of more than 11,000 positions as it looks to continue to cut expenses and improve efficiency.
Citigroup expects to record pretax charges of about $1 billion in the fourth quarter of 2012 and roughly $100 million of related charges in the first half of 2013.
said third-quarter earnings more than tripled to $2 million as revenue rose 60% to $120 million. But the Internet radio company on Tuesday issued a
for the fourth quarter. Shares plunged 17.5%.
reduced its adjusted earnings outlook for the year as traffic at the specialty bedding retailer decelerates. Shares tumbled 21.9%.
said Tuesday it expects fourth-quarter sales to fall 8% to 10% from third-quarter sales of $495 million; it previously forecast sales to drop 6% to 8%. The company cited weak demand for its older products. Shares declined 3.7%.
Securities and Exchange Commission
launched an inquiry into a $10 million sale of stock by
CEO Steven Fishman before the company announced news that sank the stock, a person familiar with the inquiry told
The Wall Street Journal
Big Lots said Fishman announced his retirement on Tuesday. The retailer said it hadn't been contacted by the SEC and that Fishman's retirement was coincidental to any regulatory interest, the newspaper reported. Shares slid 3.9%.
ADRs popped 12.8% after the Finnish mobile phone company announced with China Mobile the Lumia 920T, the first TD-SCDMA Windows phone in China.
Nokia also rolled out the Nokia Lumia 620, the third and most affordable in its range of Windows Phone 8 smartphones.
-- Written by Andrea Tse and Joe Deaux in New York.
>To contact the writer of this article, click here: