US stocks advance cautiously as Obama recruits support for Syria strike
US stocks were off to an early start Tuesday following the release of better-than-expected manufacturing data, but were weighed down later in the day as tensions over Syria re-emerged. US manufacturing activity advanced for its third consecutive month, according to a monthly report from the Institute of Supply Management. The August reading on the Manufacturing Purchasing Managers Index was 55.4 on the strength of new orders, its highest level in 2013. Of the 18 manufacturing industries operating in the United States, 15 reported growth in August.
The benchmark indices advanced cautiously Tuesday, following their worst monthly performance since May 2012. Better-than-expected economic data were weighed against the possibility of military action in Syria. US President Barack Obama was able to sway Speaker of the House John Boehner to support intervention in the Arab republic, which has been caught in the midst of civil and regional warfare for more than two years. The Ohio Republican said he would support the president’s call for action against Syria. Saudi Arabia and Israel also made a common cause for a Syria strike, and are reportedly urging the US president to respond harshly against the government of Bashar al-Assad.
The Standard & Poor’s 500 pared gains following Boehner’s comments, advancing more than 0.4 percent to 1,639.77. Among the ten industries that make up the S&P 500, utilities and telecommunications experienced the steepest declines. Microsoft faced the biggest decline in the S&P 500, losing more than 4.5 percent to $31.88 a share. The leading software company will pay Nokia €3.79 billion for its devices and another €1.65 billion for its patents, according to a statement from both companies.
The NASDAQ Composite gained more than 0.6 percent to 3,612.61. The Dow Jones Industrial Average bounced back after a mid-day decline to close at 14,834.00
Over the next two weeks market participants will weigh improvements to the US economy against a backdrop of political factors, including the FOMC policy meetings and growing threat of military confrontation against Syria. September promises to be an active and volatile month for US financials.
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