Stocks kicked off the start of the fourth quarter with modest gains on Monday, after an earlier rally faded with mixed economic news.
The Dow Jones industrial average closed at 13,515.11, up 77.98 points or 0.6 per cent – after being up as much as much as 160 points near the start of trading. The broader S&P 500 closed at 1,444.49, up 3.82 points or 0.3 per cent. In Canada, the S&P/TSX composite index closed at 12,370.19, up 52.73 points or 0.4 per cent, down about 80 points from its earlier high.
The gains followed strong moves in Europe, where stress tests on Spanish banks came in better than expected when they were released on Friday. The U.K.'s FTSE 100 rose 1.4 per cent and Germany's DAX index rose 1.5 per cent.
However, the global economic backdrop remained murky. In the United States, the ISM manufacturing index rose to 51.5 in September from 49.6 the month before. That put the index into expansion territory after three straight months of contraction and topped expectations among economists.
However, U.S. construction spending fell 0.6 per cent in August, dashing expectations for a gain.
And elsewhere, manufacturing activity struggled. In China, the final reading for the HSBC manufacturing purchasing managers' index for September remained in contraction territory, pointing to an ongoing rough patch for the world's biggest source of economic growth.
A similar index for Europe from Markit showed a gain in September over August, but it remained in contraction territory for the 14 th straight month.
Some key commodities moved higher. Crude oil rose to $92.48 (U.S.) a barrel, up 29 cents. Gold rose to $1,783.30 an ounce, up $9.40.
Among Canadian commodity producers, Suncor Energy Inc. rose 0.9 per cent and Barrick Gold rose 0.2 per cent.
U.S. financials were strong: Bank of America Corp. rose 1.5 per cent and JPMorgan Chase & Co. rose 1.2 per cent.
David Berman