U.S. Stocks Recover From Early Weakness, Close On Firm Note

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After spending a couple of hours of the day's session in negative territory, U.S. stocks recovered and stayed firm to eventually close on a positive note on Monday.

The early weakness was due to weak industrial output, retail sales and fixed-asset investment data out of China. Data showing weak business activity in New York hurt as well.

However, stocks rebounded as the day progressed with recent soft inflation data raising speculation that the Fed might slow down the pace of monetary tightening.

The major averages all ended on a firm note. The Dow ended with a gain of 151.39 points or 0.45 percent at 33,912.44, rallying from an early low of 33,582.96.

The S&P 500 settled with a gain of 16.99 points or 0.4 percent at 4,297.14, while the Nasdaq advanced 80.87 points or 0.62 percent at 13,128.05, recovering from a low of 12,993.78.

The New York Federal Reserve released a report unexpectedly showing a substantial contraction in regional manufacturing activity in the month of August.

The New York Fed said its general business conditions index plummeted to a negative 31.3 in August from a positive 11.1 in July, with a negative reading indicating a contraction in regional manufacturing activity. Economists had expected the index to show a much more modest decrease to a positive 8.5.

Looking ahead, the New York Fed said firms did not expect much improvement in business conditions over the next six months.

A separate report released by the National Association of Home Builders unexpectedly showed a continued deterioration in U.S. homebuilder confidence in the month of August.

The report showed the NAHB/Wells Fargo Housing Market Index dropped to 49 in August from 55 in July, falling below the break-even measure of 50 for the first time since May 2020. Economists had expected the index to come in unchanged.

Walt Disney shares gained more than 2 percent, reacting to news that activist investor Daniel Loeb has taken a new stake in the company.

Visa, Walt Disney, Coca-Cola, McDonalds, P&G, Amgen and Wallgreens Boots Alliance gaiend 1 to 2.3 percent.

Snap rallied more than 5 percent, buoyed by an announcement from the company that its subscription services Snapchat+ had surpassed 1 million paid users.

Chevron drifted down nearly 2 percent.

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Monday. Japan's Nikkei 225 Index jumped by 1.1 percent, while Hong Kong's Hang Seng Index slid by 0.7 percent.

The major European markets closed higher after swinging between gains and losses. The pan European Stoxx 600 climbed 0.34 percent. The U.K.'s FTSE 100 edged up 0.11 percent, Germany's DAX advanced 0.15 percent and France's CAC 40 moved up 0.25 percent.

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