U.S. stocks began a new month and a new quarter with gains Tuesday as investors appeared confident that the first partial government shutdown in almost two decades would be short-lived.
The U.S. Congress missed a midnight deadline to agree on temporary spending legislation, resulting in up to 1 million federal workers being put on unpaid leave. At the center of the impasse was a bipartisan battle over Presidaent Barack Obama’s healthcare law.
In U.S. economic news, a private research group’s manufacturing index rose to 56.2, up from the previous month and above economist expectations. But with the closure of federal government agencies, the release of a report on August construction spending was delayed.
The Dow Jones industrial average rose 62.03, or 0.4 percent, to 15,191.70. The broader Standard & Poor’s 500 index rose 13.45, or 0.8 percent, to 1,695.00. Merck shares rose 2.4 percent after the drugmaker announced a plan to cut annual operating costs by $2.5 billion by the end of 2015 and eliminate another 8,500 jobs.
The technology-heavy Nasdaq composite index rose 46.5, or 1.2 percent, to 3,817.98. Shares of Apple rose more than 2.3 percent on news that billionaire activist investor Carl Icahn had dinner with Apple chief executive Tim Cook and “pushed hard” for a massive share buyback.