Russell stays positive
The Russell 2000 (NYSE: IWM) and Dow (INDU) and the other major U.S. indices are posting solid gains with less than two hours left in the session. At 2:39 p.m. ET, the small-cap index had added 4.56 points, or 0.57%, to 807.56. The Dow Jones Industrial Average was up 62.35 points, or 0.45%, to 13,841.
Stocks have trimmed some of their early gains but are still riding a wave of positive momentum following the announcement of a deal between General Motors Corp. (NYSE: GM) and the United Auto Workers union.
The agreement, which should be ratified over the weekend after all the details are discussed, will allow the automaker to shift more than $50 billion of retiree health-care liabilities to an independent trust. The deal could allow the Detroit-based company to narrow the cost advantage enjoyed by rival Toyota Motor Corp. (NYSE: TM), which is not unionized.
In economic news, new orders for U.S. durable goods fell a greater-than-expected 4.9% in August to a seasonally adjusted $219.53 billion, the Census Bureau reported before the opening. That’s the sharpest drop in seven months and the latest sign of an economic slowdown.
Economists were expecting orders for durable goods, which are designed to last more than three years, to decline 3.1% following an upwardly revised increase of 6.1% in July.
Economists consider orders for durable goods to be a measure of business capital spending.
In other economic news, the Mortgage Bankers Association reported that its weekly index of mortgage activity fell 2.8% for the week ended Sept. 21, reflecting the ongoing slump in the U.S. housing sector.
In commodities news, the price of oil has increased $0.95 to $80.48 a barrel.
