U.S. stocks rebound on upbeat economic data

U.S. stocks rebounded on Friday as Wall Street reassessed concerns arising from news that the White House could seek a hike to the capital gains tax.

The Dow Jones Industrial Average gained 227.59 points, or 0.7%, to 34,043.49. The S&P 500 rose 1.1% to 4,180.17, while the tech-heavy Nasdaq Composite climbed 1.4% to 14,016.81.

Stocks were supported by data indicating an acceleration in economic activity and even faster growth in new home sales, as investors largely brushed off Thursday's reports that President Joe Biden would propose a large increase on the capital-gains tax for the wealthiest Americans.

In U.S. economic data, the IHS Markit purchasing managers index for the manufacturing sector rose to a record 60.5 in April from 59.1 a month earlier, while the services sector PMI jumped to 63.1 from 60.4. A reading of more than 50 indicates an expansion in activity.

New home sales rose to a seasonally-adjusted annual rate of 1.021 million in March, the U.S. Census Bureau reported the fastest pace since 2006. Month-over-month, sales rose 20.7%. Also, the Census Bureau revised the sales figure for February up to a rate of 846,000, from the originally reported rate of 775,000.

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