US stocks surge on China stimulus, earnings

Trader Timothy Nick works on the floor of the New York Stock Exchange on Monday, April 20, 2015. US stocks rose sharply Monday on the latest Chinese stimulus measures and some prominent earnings that bested forecasts. AP PHOTO/RICHARD DREW

NEW YORK–US stocks rose sharply Monday on the latest Chinese stimulus measures and some prominent earnings that bested forecasts.

The Dow Jones Industrial Average gained 208.63 points (1.17 percent) at 18,034.93.

The broad-based S&P 500 rose 19.22 (0.92 percent) to 2,100.40, while the tech-rich Nasdaq Composite Index surged 62.79 (1.27 percent) to 4,994.60.

China’s central bank announced Sunday it would cut the level of funds that commercial banks must hold in reserve in the world’s second-largest economy by one percentage point, the second such move this year to boost lending.

Investment bank Morgan Stanley gained 0.6 percent and toymaker Hasbro climbed 12.6 percent after both companies reported better-than-expected first-quarter earnings.

“There’s been a positive tone to earnings so far,” said Dan Greenhaus, chief global strategist at BTIG. “So far they’re coming in a touch better than expected.”

The gains almost reversed sharp losses Friday when fears about a Greek debt default sent global equities tumbling.

Several prominent tech companies bolted higher, including Apple (+2.3 percent), Facebook (+2.9 percent) and Amazon (+3.8 percent).

Industrial real-estate company Prologis added 0.4 percent on news it will acquire KTR Capital Partners for $5.9 billion.

Prologis holds 54 percent of the venture that is buying KTR, with Norges Bank Investment Management, manager of the Norwegian government pension fund, holding 45 percent. The transaction adds KTR properties in leading US markets, including Chicago and Seattle.

Royal Caribbean Cruises sank 8.0 percent after slashing its full-year forecast on the strong dollar and higher fuel prices.

Big-box retailer Costco Wholesale rose 1.2 percent on news it will lift its quarterly dividend from 35.5 cents per share to 40 cents and reauthorize its stock repurchase program.

Online coupon company Groupon rose 0.7 percent after announcing plans to sell a 46 percent stake in its Ticket Monster business in South Korea to a partnership that includes KKR for $360 million. The company also announced a new $300 million share repurchase program.

Bond prices fell. The yield on the 10-year US Treasury rose to 1.88 percent from 1.86 percent Friday, while the 30-year advanced to 2.55 percent from 2.52 percent. Bond prices and yields move inversely.