Wall Street shares staged some of their biggest session percentage gains of the year on Thursday after the last clutch of opinion polls pointed to an outright victory by the “Remain” camp in Britain’s Brexit referendum.
The S&P 500 index, the market bellwether, closed up 1.3% at 2,113, while the S&P Midcap 400 advanced by 1.8% to 1,517. The S&P Smallcap 600 index soared by a round 2% to 719 – just two points short of its highest level in 2016 so far – while the wider small-cap Russell 2000 index was up 2.02% at 1,172.
Part of the gains were also thanks to oil prices rising. The US benchmark West Texas Intermediate rose by 2% to $50.12, chalking up some of its best levels in two weeks.
The results of Britain’s referendum on the European Union are officially expected at around 0600 GMT on Friday with the prime minister likely to issue a statement to calm markets before the London bourse opens at 0700 GMT.
Midsession
US stocks gained at midsession on Thursday, taking direction from growing confidence on the London bourse that the “Remain” camp will secure victory in Britain’s European Union referendum, averting market turmoil.
US bank stocks were the top beneficiary, rallying by the most since early May on Thursday after polls that showed the ‘remain’ camp in the lead. The City of London and US banks based in London had feared that a Leave victory could spell not only asset upheaval in the weeks ahead but also a relocation of institutions, possibly to Frankfurt.
The market bellwether S&P 500 index was up 0.9% at 2,104, led by Micron Technology Inc (NASDAQ:MU), up 9.1% at $13.875. Shares of Micron gained more than 3% on Tuesday after Crucial, one of its subsidiaries, unveiled a new type of server memory designed to protect data from power surges. The momentum continued into Thursday after broker Nomura doubled its price target for Micron Technology, upgrading it to buy from reduce and predicting a gain of 42% in the next 12 months due to improving fundamentals.
Smaller-caps fared even better. The S&P Midcap 400 was up 1.3% at 1,510 and led by 3D Systems Corp (NYSE:DDD), up 6% at $14.06. The S&P Smallcap 600 added 1.7% to 717 and close to its 2016 highs seen earlier in June. The top riser in the ticker was Intrepid Potash Inc (NYSE:IPI), up 17.6% to $1.74.
Open
US shares surged at the open as traders mulled jobs data and took comfort from the City - the UK's financial hub - appearing to expect a "remain" result in the EU referendum.
The vote on whether the UK will leave or stay in the EU is one of the most closely watched polls in recent years and shapes the next stage of the European project.
A leave vote, or "Brexit", is expected to fuel widespread market turmoil.
Traders in the US are also cheering fall in jobless claims to an eight-week low, indicating the strength of the jobs market across the pond.
European shares rose to the highest level in more than two weeks in above-average trading as voting got underway on rainy Thursday in the UK.
FTSE100 is up 0.52% to 6,294 at the time of writing, while on Wall Street, the Dow Jones Industrial Index is up 146 points at 17,927 and the S&P500 is up 16.41 at 2,101.
The tech-heavy Nasdaq index added 41.44 to stand at 4,875.
In the S&P Midcap 400, shares gained over 19 at 1,510, while the S&P Smallcap 600 added almost ten to 715.08.
A notable gainer was Priceline Group Inc (NASDAQ:PCLN), which surged 1.35% to US$1,378.5 - the highest level in over seven months after banking titan Barclays was upbeat on the online travel services company.