Stocks spike after economic reports

Stocks rose sharply Wednesday after a batch of economic reports offered some hope that the U.S. economy was improving. Investors seized on encouraging readings on the labor market and Americans’ incomes while shrugging off a steep fall in new home sales and manufacturing orders.

The rebound suggests that investors are no longer counting on a rebound in the housing market to move the economy forward.

The upturn marked an abrupt reversal from earlier this week, when an exchange of artillery fire between North and South Korea led nervous investors to sell stocks and dash into gold, Treasurys and other assets often used as hiding spots.

The Dow Jones industrial average rose 134.75, or 1.2 percent, to 11,171.12 in early afternoon trading.

The Standard & Poor’s 500 index gained 15.45, or 1.3 percent, to 1,196.18. The Nasdaq composite index rose 46.89, or 1.9 percent, to 2,541.80.

Safety assets moved lower as investors became more willing to take on risk. The dollar and gold both fell, while Treasury prices edged lower, pushing their yields higher. The yield on the 10-year note inched up to 2.85 percent from 2.77 percent Tuesday.

U.S. stock and bond markets will be closed Thursday for the Thanksgiving holiday. They will reopen for half-day sessions on Friday.

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