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Stocks power higher after a dreadful week; Dow jumps 410

Stocks power higher after a dreadful week; Dow jumps 410

February 13th, 2018 in Business

FILE- This Oct. 29, 2014, file photo, shows the Wall Street subway stop on Broadway, in New York's Financial District. The U.S. stock market opens at 9:30 a.m. EST on Monday, Feb. 12, 2018. (AP Photo/Richard Drew)

NEW YORK (AP) — Stocks powered higher Monday, sending the Dow Jones industrial average up 410 points, as the market clawed back more of its massive losses from the previous two weeks.

Apple jumped 4 percent and led a rally in technology companies, while industrial companies, banks, and consumer-focused companies like retailers also rose.

Netflix and Amazon surged again as stocks that led the market higher in 2017 recovered more of the ground they lost recently. Energy companies got some relief as oil prices turned higher. All of that helped stocks build on the market’s gains from late Friday.

Some market watchers say the recent bout of turbulence may not be over. Jim Paulsen, chief investment strategist for the Leuthold Group, said he thinks stocks and bonds will fall further as investors consider the likelihood that interest rates will keep rising and inflation will increase. Inflation and higher wages can cut into company profits, and higher interest rates slow down economic growth.

Paulsen said the consumer prices report Wednesday or the February employment report due next month could have major effects on the market.

The Standard & Poor’s 500, the benchmark for many index funds, gained 36.45 points, or 1.4 percent, to 2,656. The Dow climbed 410.37 points, or 1.7 percent, to 24,601.27. It had risen as much as 574 earlier, led by big gains for Boeing and Apple.

The Nasdaq composite advanced 107.47 points, or 1.6 percent, to 6,981.96. The Russell 2000 index of smaller-company stocks rose 13.15 points, or 0.9 percent, to 1,490.98.

It took just nine days for stocks to plunge 10 percent from their latest peak, which was reached Jan. 26. A drop of that size is known on Wall Street as a market “correction.” According to LPL Financial, it was the swiftest move from a record high to a correction in the history of the S&P 500. The index rose 1.5 percent Friday but still wound up with its worst weekly loss in more than two years.

Despite the two-day recovery, the S&P 500 is down 7.5 percent from its record high, and investors expect far more volatility in the stock market than they did two weeks ago.

That comes after a remarkably calm year for stocks: there were only eight days in 2017 where the S&P 500 rose or fell at least 1 percent. However, it’s happened six times in the last seven trading days, and eight times since the market’s peak Jan. 26. That includes several drops that were far larger than anything the market endured last year.

Other gainers in the technology industry included Cisco Systems, which rose $1.07, or 2.7 percent, to $40.60. Chipmakers Broadcom and Qualcomm each climbed after CNBC reported that the companies will meet this week to discuss Broadcom’s $121 billion offer to buy Qualcomm.

Oil prices have dropped since reaching long-time highs in late January, when U.S. crude peaked at $66 a barrel. The S&P 500 energy index is down 12.7 percent over the last month.