Tech Stocks, Debt Deal Provide a Lift

Investors welcome agreement in Congress
By Newser Editors and Wire Services
Posted Oct 7, 2021 4:35 PM CDT
Investors Embrace Debt Ceiling Deal
A surveillance camera is posted outside the New York Stock Exchange in New York on Tuesday. Tech companies contributed to the market's climb.   (AP Photo/Mary Altaffer)

(Newser) – Technology companies helped lift stocks on Wall Street broadly higher Thursday as investors welcomed the end of a standoff in Congress over extending the federal debt ceiling. An agreement to temporarily extend the government's borrowing authority into December gives lawmakers more time to reach a permanent solution, averting for now an unprecedented federal default that experts say would have devastated the economy. The S&P 500 rose 0.8%, its third straight gain. Nearly 80% of stocks within the benchmark index gained ground, the AP reports. The Dow Jones Industrial Average rose 1%, while the tech-heavy Nasdaq closed 1.1% higher.

The debt ceiling debate and the potential for an unprecedented federal default are among many concerns that have been weighing on the market. Those worries sent the benchmark S&P 500 swinging between daily gains and losses of more than 1% for four days. The temporary compromise between Republicans and Democrats may have also helped give investors optimism that Congress can work out compromises in other areas, said Greg Bassuk, CEO at Axs Investments. "The fact that it actually got done, we think, frankly, that we are seeing an outsized reaction in the markets today because of the sentiment that, 'Hey, maybe some more can get done as well,'" he said.

The S&P 500 rose 36.21 points to 4,399.76. The Dow gained 337.95 points to 34,754.94, and the Nasdaq added 152.10 points to 14,654.02. Technology stocks powered a big share of the S&P 500's gains. Apple rose 0.9% and chipmaker Nvidia added 1.8%. Small company stocks, a gauge of confidence in economic growth, also notched gains. Automakers were big winners among consumer discretionary sector stocks, with Ford Motor up 5.5% and General Motors 4.7%. Energy futures prices bounced back after the US Energy Department said it is not planning on tapping oil reserves. The price of US crude oil rose 1.1%. And the yield on the 10-year Treasury rose to 1.57% from 1.52% late Wednesday.

(Read more stock market stories.)

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