NEW YORK -- U.S. stocks rallied to their highest level in more than a month Tuesday after China's government moved to inject more life into its economy by cutting taxes and increasing spending. Netflix led a surge in high-tech companies.
The S&P 500 index rose 27.69 points, or 1.1 percent, to 2,610.30, its first close above 2,600 since Dec 13. The Dow Jones industrial average added 155.75 points, or 0.7 percent, to 24,065.59.
The technology-heavy Nasdaq composite jumped 117.92 points, or 1.7 percent, to 7,023.83.
Health care companies and banks rose as major companies including UnitedHealth and JPMorgan Chase announced their fourth-quarter results.
The British pound wobbled after legislators soundly rejected Prime Minister Theresa May's plan governing the country's departure from the European Union. While the deal's defeat might herald more chaos for companies in Britain and Europe in the months ahead, the outcome of the vote was long expected and stocks didn't react much.
Investors were encouraged to see China make moves to stimulate growth. China is enduring its worst slowdown since the global financial crisis during a punishing tariffs dispute with the U.S.
"It shows clear signs they are worried about the economy," said Lindsey Bell, an investment strategist at CFRA. But to investors, who want China's economy to pick up again, Bell said the latest steps were "really welcome news."
Chinese leaders plan to reduce taxes, increase government spending, and provide financing to private and small enterprises in a bid to strengthen the world's second-largest economy.
That helped tech companies, which make big chunks of their sales in China. Microsoft rose 2.9 percent to $105.01 and Broadcom climbed 2.2 percent to $256.49.
Hong Kong's Hang Seng rebounded 2 percent, wiping out a loss on Monday. It's moved higher this month but is still down almost 19 percent from its peak in late January 2018.
Japan's Nikkei 225 index, reopening after a market holiday, added 1 percent. The Kospi in South Korea jumped 1.6 percent.
Netflix announced a price increase to help to pay for its huge investment in original shows and films and finance the heavy debt it has assumed to ward off rivals such as Amazon, Disney and AT&T. The price of its most popular video-streaming plan will rise to $13 per month from $11. Its stock climbed 6.5 percent to $354.75.
Facebook rose 2.4 percent to $148.95, Amazon gained 3.5 percent to $1,674.56, and Google's parent company Alphabet jumped 3.3 percent to $1,086.51.
In Britain, the House of Commons rejected the deal May negotiated with EU leaders by a vote of 432-202. The country is scheduled to leave the EU on March 29 after a June 2016 referendum where a narrow majority of U.K. subjects voted to take Britain out of the union. It's not clear what will happen to May's government, which faces a vote of no confidence, or the economies and financial systems of Britain and the rest of Europe.
The pound dipped as low as $1.2670 ahead of the vote and later traded at $1.2834, down from $1.2865 late Monday. The British FTSE 100 index closed up 0.6 percent, but banks including Lloyd's and Royal Bank of Scotland slipped.
Bell, the CFRA investment strategist, noted that British stocks have continued to rise since the 2016 referendum because the global economy and company profits kept growing.
Business on 01/16/2019