Wall St climbs as Ukraine worries ease

By Chuck Mikolajczak

NEW YORK (Reuters) - U.S. stocks climbed on Monday, with the S&P 500 bouncing from its worst weekly drop in the past seven as concerns eased over the situation in Crimea, even as the region voted to join Russia.

The 97-percent vote in Crimea in favor of quitting Ukraine was condemned as illegal by Kiev and the West, with the White House calling Russian actions "dangerous and destabilizing," but the referendum passed without violence.

In response, U.S. President Barack Obama on Monday imposed sanctions on 11 Russian and Ukrainian officials blamed for Russia's military incursion into Crimea, including two top aides to Russian President Vladimir Putin.

 

The geopolitical tension weighed on equities last week, with the S&P 500 falling 2 percent and the CBOE Volatility index jumping to its highest since early February on Friday.

"The Russian vote is over and I don't think it's any great surprise and we are bouncing off of where we were last week," said Doug Foreman, co-chief investment officer of Kayne Anderson Rudnick Investment Management in Los Angeles.

The advance continued a recent trend of investors using market pullbacks as buying opportunities. Major indexes have not undergone a sustained pullback in more than a year.

The Dow Jones industrial average rose 175.16 points or 1.09 percent, to 16,240.83, the S&P 500 gained 17.02 points or 0.92 percent, to 1,858.15 and the Nasdaq Composite added 43.086 points or 1.01 percent, to 4,288.483.

The U.S. Federal Reserve's massive stimulus has helped keep a floor under equity prices, and market participants are looking ahead to a two-day meeting of the Fed's policy-setting committee, which begins Tuesday.

The Fed is unlikely to deviate from previously announced policies, but it could use the meeting - the first with Janet Yellen as chair - to map out its plan for rate rises. The central bank has said that the first rate rise is likely to come around the middle of next year, as long as the U.S. economy keeps healing.

In the latest economic data, the New York Fed's "Empire State" gauge of New York manufacturing rose in March, helped by increases in new orders and inventories, though the rise was less than forecast. Separately, industrial output rose 0.6 percent in February, a far bigger rise than had been expected.

"It looks like maybe we are thawing out a little bit in terms of the economic indicators. The market has got it right, you don't have to be a rocket scientist or a weatherman to figure out it's been a tough winter," said Foreman.

In company news, Chinese e-commerce giant Alibaba Group Holding Ltd said on Sunday it would begin the process toward a U.S. initial public offering, ending months of speculation. Shares of Yahoo Inc , which has a 24 percent stake in the company, jumped 4 percent to $39.11 as one of the best performers on the benchmark S&P index.

JA Solar Holdings Co shares advanced 4.7 percent to $11.96 after the company posted its first profit in 10 quarters and forecast higher shipments for the year.

Giant Investment Ltd will acquire Chinese online gaming company Giant Interactive Group Inc for $3 billion and take it private, the companies said on Sunday. Shares of Giant rose 1.6 percent to $11.58.

(Reporting by Chuck Mikolajczak; Editing by Nick Zieminski)