US stocks join global rally; S&P 500 plus 2.5 per cent

The Wall Street sign is seen outside of the New York Stock Exchange (NYSE) in New York.
The Wall Street sign is seen outside of the New York Stock Exchange (NYSE) in New York. PHOTO: BLOOMBERG

NEW YORK (AFP) - US stocks powered higher Tuesday, rallying with most global equity markets following a rise in Chinese stocks and improved eurozone economic data.

At the closing bell, the Dow Jones Industrial Average was at 16,489.41, up 387.03 points (2.40 per cent).

The broad-based S&P 500 jumped 47.99 (2.50 per cent) to 1,969.21, while the tech-rich Nasdaq Composite Index gained 128.01 (2.73 per cent) at 4,811.93.

The gains followed a 2.92 per cent rise in China's volatile Shanghai Index and an upgrade on the reading for eurozone second-quarter economic growth to 0.4 per cent from the prior estimate of 0.3 per cent.

The Wall Street advance also helped offset deep losses last week when China fears led to a 3.4 percent drop in the S&P 500. The US markets were closed Monday for the Labor Day holiday.

"The market was so oversold after last week, we were probably due for a bounce," said Bill Lynch, director of investment at Hinsdale Associates.