U.S. Stocks Surge on Good Manufacturing Data

Better than expected news from sector

Stocks were higher in morning trade on July 1 for the fifth straight day buoyed by better-than-expected data on the performance of the manufacturing sector in June.

In thin trade ahead of the long July 4 holiday weekend, at 1500 GMT the Dow Jones Industrial Average had added 109.81 points (0.88%) to 12,524.15.

The broader S&P 500 gained 9.37 (0.71%) to 1,330.01, while the tech-heavy Nasdaq Composite was up 22.20 points (0.8%) at 2,795.72.

Good news came from the Institute of Supply Management which reported that the U.S. manufacturing sector picked up pace in June hinting at a pickup in the economy at the end of a slumping second quarter. The ISM purchasing managers' index for the manufacturing sector climbed 1.8% in June to a better-than-expected 55.3, from 53.5 in May. But that came after a sharp seven percent drop in May from April, and the June index remained far below the 60-plus level achieved in the first four months of the year.

Specialty truck maker Oshkosh Corp was up 12.3% on news that raider Carl Icahn had accumulated a 9.5% stake in the company and reportedly plans to pressure management to deliver more to shareholders.

Microsoft and Apple were up 0.1% and 0.4 percent respectively after their consortium won an auction for the huge, valuable patent assets of bankrupt Nortel with a $4.5 billion bid.

The shares of Google, whose bid failed, were 1.7% higher. Intel, another losing bidder, was up 1.2%.

Bond prices fell. The yield on the 10-year U.S. Treasury note rose to 3.20% from 3.16% late on June 30 while that on the 30-year bond edged upwards to 4.40% from 4.38%.

Copyright Agence France-Presse, 2011

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