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Dow closes above 18,000 as Britain votes on whether to leave the EU

New York Stock Exchange
A U.S. flag flies from the New York Stock Exchange building.
(Seth Weinig / Associated Press)

U.S. stocks made their biggest gains in a month Thursday as investors grew more optimistic that Britons would vote to stay in the European Union. Investors bought stocks and sold bonds, sending bond yields and banks higher.

On the last trading day before results from the British referendum, stocks continued to rise as investors grew more confident Britain wouldn’t leave the union. Bank stocks did the best; materials companies also rose. Oil topped $50 a barrel. Utility companies, which are generally seen as safe investments, lagged behind the overall market as investors took a few more risks.

U.S. stocks have advanced about 2% this week. Before that, the market slumped as investors worried that a “Leave” vote would disrupt the economies of Britain and Europe. Throughout this year, the market has bobbed up and down as investors traded on political and central bank news, such as the British referendum and comments from the Federal Reserve.

J.J. Kinahan, chief strategist at TD Ameritrade, said that’s because the global economy is sluggish. Corporate profits and revenues also have been uninspiring.

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“What it really shows is just a lack of growth,” he said. “That makes it very difficult to commit capital, and I think that’s a pattern you’re going to continue to see.”

The Dow Jones industrial average jumped 230.24 points, or 1.3%, to 18,011.07. The Standard & Poor’s 500 index rose 27.87 points, also 1.3%, to 2,113.32. The Nasdaq composite climbed 76.72 points, or 1.6%, to 4,910.04.

European stock indexes also advanced. France’s CAC 40 rose 2%, and Germany’s DAX gained 1.8%. Britain’s FTSE 100 rose 1.2%.

Bond prices declined, sending the yield on the 10-year Treasury note up to 1.75% from 1.69% a day earlier.

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Higher bond yields mean higher interest rates, which enable banks to make money on lending. Citigroup stock rose 4.2% to $44.46, and Bank of America shares climbed 3.2% to $14.04.

The British pound rose to $1.4808 from $1.4691, its highest level of the year. The dollar rose to 105.78 yen from 104.47 yen. The euro rose to $1.1351 from $1.1307.

U.S. crude rose 98 cents, or 2%, to $50.11 a barrel in New York. Brent crude, the benchmark for international oil prices, rose $1.03, or 2.1%, to $50.91 a barrel in London. Among energy stocks, Chevron ticked up 2.1% to $104.44, and ConocoPhillips rose 3.7% to $45.63.

Fertilizer maker Mosaic climbed 4.7% to $28 on reports that the large potash companies of Russia and Belarus might start working together, something they haven’t done since 2013. That might bolster prices of the fertilizer, which have slumped in recent years. Other mining and chemicals companies also surged. Paint and coatings maker PPG Industries rose 3.2% to $111.22, and gold and copper miner Freeport-McMoran advanced 2.3% to $11.77.

Software company Twilio surged after its initial public offering raised more money than analysts expected. The San Francisco company makes software that helps companies communicate with their customers and employees through methods such as text messages and phone notifications. Its IPO priced at $150 million, and the stock soared 91.9% to $28.79.

Bookseller Barnes & Noble reported stronger-than-expected sales, and its stock jumped 7.9% to $11.26.

Macy’s, the largest U.S. department store, said Chief Executive Terry Lundgren will step down early next year after about 13 years in charge. He will remain chairman of the company, and President Jeff Gennette will become CEO. Macy’s stock rose 1.7% to $33.38.

Software maker Red Hat fell 1.7% to $78.39 after it posted mixed quarterly results and a disappointing outlook. The company also said it will buy software maker 3scale, but didn’t disclose terms.

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The Labor Department said applications for unemployment benefits fell last week, more evidence employers are keeping workers and may be hiring at a faster pace. About 2.1 million Americans are receiving those benefits, or 4.6% fewer than a year ago.

The price of gold fell $6.90 to $1,263.10 an ounce, and it’s down almost 3% over the past five days. Silver rose 4 cents to $17.35 an ounce. Copper advanced 3 cents to $2.16 a pound.

In other energy trading, wholesale gasoline rose 2 cents to $1.60 a gallon. Heating oil ticked up 2 cents to $1.52 a gallon. Natural gas advanced 2 cents to $2.70 per 1,000 cubic feet.

In Asia, Japan’s benchmark Nikkei 225 gained 1.1%, Hong Kong’s Hang Seng climbed 0.4% and South Korea’s Kospi fell 0.3%.


UPDATES:

1:47 p.m.: This article was updated with additional information.

1:12 p.m.: This article was updated with closing prices.

8:59 a.m.: This article was updated with more recent prices and additional information.

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This article was originally published at 7:47 a.m.


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