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U.S. stocks rally in early trade; Dow Jones up 1.38%

Published 07/06/2010, 09:56 AM
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Investing.com – U.S. stock markets rallied in early trade on Tuesday, rising on the back of gains in the European and Asian markets and bolstered by comments from the Australian central bank.

During early U.S. trade, the Dow Jones Industrial Average was up 1.38%; the S&P 500 index rose 1.53% and the Nasdaq Composite index advanced 1.76%.

Market sentiment was boosted after the Reserve Bank of Australia said late Monday that the global economy had continued to expand, with growth in Asia remaining strong and signs emerging from China that growth there was now developing at a more sustainable pace.

Top performers included Wal-Mart Stores which rose 2.5%, Bank of America which gained 2.4% and Caterpillar which climbed 2.3%.

Meanwhile, shares of BP rose 5.4% after the company ended speculation that it was looking for a "white knight" investor to ward off takeover bids by saying it would not issue new equity to raise money to cover the costs of the Gulf of Mexico oil spill.

Across the Atlantic, European stock markets were up: France’s CAC 40 soared 3.43%; Germany's DAX climbed 2.7%; Britain's FTSE 100 gained 2.7%; and the EURO STOXX 50 advanced 3.5%.

Earlier in the day, Reuter's reported that European Central Bank president Jean-Claude Trichet was due to meet with the heads of major European banks to discuss the results of bank stress tests ahead of their publication later in the month.

Later Tuesday, the U.S. was to produce a closely watched report on its services sector which was expected to show smaller than expected growth in June.

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