US close: Stocks surge as oil prices soar

US stocks gained on Monday as oil prices edged higher and investors shrugged off weaker-than-expected manufacturing data.

The S&P 500 added 0.28% to 2,190.15, the Dow Jones Industrial Average gained 0.32% to 18,636.05, and the Nasdaq 100 climbed 0.42% to 4,827.12.

Oil prices also rallied on hopes of action by OPEC to stabilise the market ahead of a meeting next month.

West Texas Intermediate was last up 1.98% at $45.29 per barrel and Brent crude increased 2.25% to $48.05.

In economic data, the Empire State manufacturing index for August fell to negative 4.2 from 0.55 in July. Economists had expected a reading of 2.

“Overall, we think manufacturing is now expanding slowly, but no boom is in prospect,” said Pantheon Macroeconomics.

Meanwhile, the National Association of Home Builders said builder confidence rose in August as positive job growth in July offset weak GDP reports. The index for builder sentiment increased two points to 60 from a downwardly-revised reading of 58 in July, as expected by analysts.

Earlier, Japanese data showed the nation’s economy hardly grew in the April to June quarter, weighed by exports and business investment.

The economy grew 0.2% on an annualised basis, down from 1.9% in the first three months of the year. Meanwhile, private consumption nudged up just 0.2%, down from 0.6% growth the quarter before.

“The BoJ has found few things to cheer about in recent years, and with today’s poor growth data coupled with yen fuelled disinflation, the BoJ look likely to ease once more as a result,” said IG market analyst Joshua Mahony.

In corporate news, Apple shares rose 1.2% following a press report over the weekend that it isn’t likely to repatriate overseas assets.

Honeywell International gained 0.14%, paring earlier gains after reports it is nearing a deal to buy JDA Software Group.

Mid-America Apartment Communities slumped 3.89% after confirming it plans to buy Post Properties.

Shares in Post Properties advanced 9.42%.