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Wall Street Blasts Off as Congress Finally Produces Debt-Ceiling Deal

Stocks roared to life on Wednesday, as Senate Majority and Minority leaders Harry Reid and Mitch McConnell officially announced an agreement to end a half-month old government shutdown and raise
Michael Teague is a staff writer for Equities.com. His previous experience includes three years as the associate editor of Los Angeles-based Al Jadid Magazine, a bi-annual review of the arts & culture of the Middle East, where he contributed many articles on the region in the form of features and book & film reviews. His educational background includes a BA in French literature from the University of California, Irvine, where he developed a startling proclivity for anything having to do with the 19th century.
Michael Teague is a staff writer for Equities.com. His previous experience includes three years as the associate editor of Los Angeles-based Al Jadid Magazine, a bi-annual review of the arts & culture of the Middle East, where he contributed many articles on the region in the form of features and book & film reviews. His educational background includes a BA in French literature from the University of California, Irvine, where he developed a startling proclivity for anything having to do with the 19th century.

Stocks roared to life on Wednesday, as Senate Majority and Minority leaders Harry Reid and Mitch McConnell officially announced an agreement to end a half-month old government shutdown and raise the US debt ceiling through the remainder of 2013.

After what seemed like an eternity of increasingly shrill politicking in Washington, D.C. that at times seemed to make brave forays into absurdism, House Republicans relented on their demands for the defunding of President Obama’s signature 2010 Patient Protection and Affordable Care Act in exchange for keeping the government open and allowing the nation to pay its bills.

Markets reacted with overt jubilation, despite the fact that Wednesday’s arrangement does not so much provide a solution that would prevent a repeat of this most recent political calamity, as much as it would simply postpone it until the beginning of next year. Indeed, the deal keeps the government funded through early January, and raises the debt limit until early February, which could leave Americans facing a nearly identical situation right after the holidays.

By the closing bell, the Standard & Poor’s 500 index had added 1.38 percent, climbing to 1,721.51 points, while the Dow Jones Industrial Average rose 1.36 percent to 15,373.77, and the NASDAQ gained 1.20 percent to a tally of 3,839.43.

The deal in Washington also sent oil prices higher, the biggest beneficiaries of which were independent drillers and producers. On the S&P, Pioneer Natural Resources ($PXD) was one of the top performers, closing 5.5 percent higher, with Chesapeake Energy ($CHK) in tow.

Financial stocks topped the Dow, with JPMorgan Chase (JPM) and Goldman Sachs (GS) both adding over three percent ahead of the close, despite the fact that a US Magistrate judge has ordered the company to hand over complaints it is alleged to have received on the part of some of the bank’s female employees who feel as though they had been discriminated against during their tenures.

The NASDAQ was helped by healthcare stocks, with Keryx Biopharmaceuticals (KERX) jumping almost 20 percent on news of an upgrade from Roth Capital, while Geron Corporation (GERN) was 40 percent higher by the closing bell after its stock was also upgraded. Meanwhile, Solar City (SCTY) was also among the exchange’s best performance, finish 12 percent higher after announcing the acquisition of rival Zep Solar.

Twitter made official its intent to be listed on the New York Stock Exchange in filings with the Securities and Exchange Commission late on Tuesday. The social media giant has gone to great lengths to hold its IPO as differently as possible from other techs, who usually list on the NASDAQ.

 

[Image Courtesy of Wikimedia Commons]