Stocks kicked off a new month with strong gains on Wednesday after manufacturing in the US and in China expanded at a faster pace than forecast in August. The positive report dispelled recent worries about the global economy.
The Institute for Supply Management (ISM)’s factory index unexpectedly rose on Wednesday to 56.3 from 55.5 in July. The ISM said manufacturing activity rose in the US in August despite recent regional reports pointing to a slowdown.
Stocks further extended gains after the report was announced, with the Standard & Poor’s 500 Index rising 2.5 percent to 1,075.17 at 10:13 a.m. in New York. The Dow Jones industrial average jumped more than 220 points.
Manufacturing in China also picked up in August, and overseas markets surged on Wednesday when Australia announced its economy grew in the second quarter at the fastest pace in three years.
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