Dawn Chorus: Wall Street surges on Basel III deal and positive Chinese data

Wall Street surged on Monday to its highest level in a month as a global agreement on bank capital requirements in Basel and upbeat Chinese factory data raised confidence in the economy.

The S&P 500 climbed 1.1% to 1,122, breaking through its 200-day moving average for the first time since early August. The Dow Jones industrial average gained 81 points, or 0.78%, to 10,544. The Nasdaq Composite Index jumped 43 points, or 1.93%, to 2,286.

Financial stocks were the top performers on Wall Street. Global regulators agreed to compel lenders to more than triple their top-quality capital reserves in hopes of preventing another credit crisis. But the new package, known as "Basel III," provides transition periods that could extend to January 2019 or later.

Goldman Sachs gained 2.7%, JPMorgan Chase surged 3.7% and US Bancorp was up 3.3%. Bank of America added 3% and Citigroup rose 2.1%.

Industrial stocks rose after positive Chinese data on industrial production and retail sales added to the optimistic mood. General Electric gained 1.7%, Caterpillar was up 1.4% and Honeywell rose 1.1%.

In the technology sector, shares gained in response to a flurry of takeover deals. Hewlett-Packard agreed to buy cyber security company ArcSight, and the Dollar Thrifty Automotive Group said it had accepted the acquisition offer of Hertz Global Holdings. ArcSight surged 25.1%, while HP edged up 0.2%. Dollar Thrifty gained 5.4%, with Hertz rising 7.9%.

In Europe, shares gained after the European Commission said the euro region’s gross domestic product may increase 1.7% this year instead of a previously projected 0.9%. The FTSEurofirst 300 index rose 0.6% to 1,088. Britain's FTSE 100 ended the day 1.2% higher, Germany's DAX and France's CAC40 rose 0.8% and 1.1% respectively.

In current trading, Asian stocks gained on Tuesday in response to forecast for faster European economic growth. The MSCI Asia Pacific Index rose 0.3% to 124 as of 11:36 a.m. in Tokyo. Hong Kong’s Hang Seng was up 0.15% at 21,691, while Shanghai Composite Index was trading 0.1% lower at 2,688.