US stocks rise, led by cars and technology

A jump in US car sales and other good news on the economy helped drive the stock market higher yesterday.

General Motors and other carmakers surged after posting strong sales in August, giving the industry its best month in six years.

“Car sales were really impressive,” said Peter Cardillo, chief market economist at Rockwell Global Capital in New York.

He said they are important for what they suggest about the larger economy: solid consumer spending and increased manufacturing. “It means the economy is holding up,” Mr Cardillo said.

The Standard & Poor’s 500 index rose 13.31 points, or 0.8%, to 1,653.08.

The Dow Jones industrial average gained 96.91 points, or 0.7%, to close at 14,930.87 and the Nasdaq composite rose 36.43 points, or 1%, to 3,649.04.

Jim Russell, a senior equity strategist at US Bank Wealth Management in Cincinnati, said recent economic reports have drawn a brighter picture of the global economy, even as concerns over a US strike on Syria have claimed much of the public’s attention.

A trade group said yesterday that US factories increased production last month at the fastest pace since June 2011, propelled by a sharp rise in new orders. Separate reports out on Monday showed stronger manufacturing in Europe and China.

“All of these add up to better economic growth on a global scale,” Mr Russell said.

Yesterday, General Motors said its sales rose 15% last month, while Chrysler and Ford each reported 12% gains. Toyota posted the biggest increase as sales rose nearly 23% since August of last year.

The Nasdaq Stock Market ran into technical problems for the second time in two weeks. The exchange reported that its system for disseminating prices had a brief outage, from 11.35am to 11.41am local time, but said trading was not affected.

On August 22, all trading in Nasdaq-listed stocks was halted for three hours because of a problem with the same quote-disseminating system.

Investors were also looking ahead to tomorrow, when the August jobs report will be released. Economists expect that the U.S. created 177,000 jobs last month and that the unemployment rate held steady at 7.4%, according to the data provider FactSet.

The jobs report is the last major piece of economic data the Federal Reserve will have to work with before the central bank decides whether or not to pull back on its massive bond-buying programme.

That programme has kept interest rates abnormally low. While most investors believe the Fed will begin to pull back, the question has become when and how much.