2013 Kicks Off With ‘Cliff’ Rally
U.S. stocks kicked off the new year with their best day in over a year on Wednesday, sparked by relief over a last-minute deal in Washington to avert the “fiscal cliff” of tax hikes and spending cuts that threatened to derail economic growth. The Dow Jones industrial average gained 308.41 points, or 2.35 percent, to end at 13,412.55. The Standard & Poor’s 500 Index jumped 36.23 points, or 2.54 percent, to 1,462.42. The Nasdaq Composite Index rose 92.75 points, or 3.07 percent, to close at 3,112.26.
The majority of taxpayers can celebrate the provisions of the fiscal-cliff bill passed by Congress on Tuesday, at least with regard to tax law: the continuation of the income-tax rates they’ve enjoyed for a decade, certainty with regard to the alternative minimum tax, and the extension of a number of popular tax breaks.
U.S. manufacturing grew slightly last month and factory hiring increased. The Institute for Supply Management said Wednesday that its index of manufacturing activity rose in December to 50.7. That’s up from a reading of 49.5 in the November, which was the lowest reading since July 2009, one month after the recession ended.