Chems rise as US Dow Jones Industrial Average gains 323 points

10 October 2013 21:44  [Source: ICIS news]

HOUSTON (ICIS)--Chemical stocks rose along with the Dow Jones Industrial Average, which increased on Thursday by 323.09 points.

The average closed at 15,126.07, up 2.18%.

The Dow Jones US Chemicals Index rose by 2.16%.

Among the companies followed by ICIS, refiner PBF Energy gained the most, rising by 11.52%. It was followed by Valero, which increased by 4.71%. Several others rose by more than 3%.

But not all stocks rose. Canada-based fertilizer producer Agrium was the biggest loser, falling by 1.26%.

Among the majors, Dow Chemical rose by 3.80% and DuPont rose by 2.37%. Specialty chemicals producer Eastman Chemical rose by 1.94% while fertilizer producer PotashCorp lost 0.38%.

Industrial air producer Praxair rose by 1.92%.

The increase followed news that House Republican leaders would offer to President Barack Obama legislation to increase the US federal debt limit and end the government shutdown, a move welcomed by the White House.

The federal government began a partial shutdown of operations on 1 October, when existing spending authorisation expired.

Republicans in the House - where by law authority for spending resides - have been pressing Obama and the Democrat majority in the Senate for spending cuts in exchange for a continuing resolution (CR) that would restore the federal government’s authority to spend.

Approximately 800,000 of the federal government’s 2.1m employees have been furloughed, and no federal workers are being paid while the spending authority is suspended.

But the risk of a looming federal government default has greatly increased pressure on both parties to reach a resolution.

By Thursday of next week, 17 October, the US Treasury Department says it will run out of money to meet interest and principal payments on loans made to the US government.

The US government’s debt ceiling limit, which is set by Congress, is currently at $16,700bn (€12,400bn). If the House fails to pass a bill raising that limit by next Thursday, the US would technically be in default.

That has never happened before, and economists worry that such a development could trigger a major US and even a worldwide recession.

($1 = €0.74)

Additional reporting by Joe Kamalick

By: Al Greenwood
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