U.S. stocks rise with global markets amid U.K. referendum vote

ZURICH – U.S. stocks rose, mirroring equities around the world and sending the S&P 500 Index toward the strongest gain in a month, as a U.K. referendum on its European Union membership got underway.

The S&P 500 jumped 0.8 percent to 2,102.38 at 9:33 a.m. in New York, after two opinion polls conducted before Thursday showed a lead for the campaign to keep Britain in the European Union. Investors worldwide have been glued to Britain’s debate on its EU membership in recent weeks, and past polls have indicated a close race. Voting has begun in the United Kingdom, and the first results are expected at about 7 p.m. New York time. The final ones are due at about 2 a.m. on Friday.

“People have already taken positions ahead of the vote,” said Patrick Spencer, equities vice chairman at Robert W. Baird & Co. in London. His firm manages $151 billion. “Markets hate uncertainty, and tomorrow we’ll finally have certainty – we’ll know which way we’re going. In the United States, we’re back to that Goldilocks scenario. You’ve got reasonable growth, but not so strong so as to raise rates.”

The S&P 500’s rally Thursday follows the index’s first retreat in three days, and a 15 percent jump in the CBOE Volatility Index amid fragile sentiment before the U.K. vote. The gauge of market turbulence known as the VIX is on track for its biggest monthly climb since a record surge in August.

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The main U.S. equity benchmark has struggled to top an all-time high reached 13 months ago, after closing within 0.6 percent of the mark earlier in June. The S&P 500 surged as much as 16 percent from a 22-month low in February amid rebounding oil prices and improving economic data, though its momentum has been challenged by successive quarters of declining corporate profits, recent signs of slowing job gains and concerns that central-bank efforts to bolster growth are losing their efficacy.

Those worries were roused last week after the Federal Reserve signaled less optimism on the economic outlook, scaling back its projections for the pace of future interest-rate increases amid concerns about slower job growth and the U.K.’s potential EU exit. In testimony to lawmakers this week, Fed Chair Janet Yellen indicated a cautious and uncertain view of the economy.

Traders are now pricing in even odds of a rate increase in December, drawing closer after the probability was pushed out beyond February 2017 following last week’s Fed meeting. As investors and policy makers assess incoming data to judge the path of borrowing costs, a report Thursday showed fewer Americans than forecast filed for unemployment benefits last week, adding to evidence that the labor market is healthy and stable. Data on new-home sales are due later Thursday.

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