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Wall Street climbs with higher oil prices

Wall Street climbs with higher oil prices
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First Published: Tue, Jun 30 2009. 08 42 AM IST
Updated: Tue, Jun 30 2009. 08 42 AM IST
New York: US stocks rose on Monday as higher oil prices lifted shares of energy companies and fund managers snapped up this quarter’s winners to burnish their portfolios.
Energy shares ranked among the quarter’s strong performers, and a 3.4% jump in the price of oil lifted them even further on Monday. Exxon Mobil Corp was the Dow’s top driver, rising 2.2% to $70.58.
Fund managers are enhancing their portfolios before the quarter ends on Tuesday in a ritual known as “window dressing” by selling some of the quarter’s losers and scooping up the winners. This move bolstered stocks as well.
“This has been a heck of a run,” said Marc Pado, US market strategist at Cantor Fitzgerald & Co, in San Francisco. “A lot of people didn’t believe and left a lot at the table. Having the right positions (and) not showing a great deal of cash, that is really the main driving force here - the so-called window dressing.
The S&P 500 is up 16.2% so far for the quarter, putting it on track for its best quarter since the fourth quarter of 1998, when the index jumped nearly 21%. The S&P 500 has gained 37% since hitting a 12-year closing low in early March as early signs of an economic rebound surfaced.
Financials were the day’s top advancer and the leader for quarterly gains, followed by technology.
The Dow Jones industrial average gained 90.99 points, or 1.08%, to end at 8,529.38. The Standard & Poor’s 500 Index was up 8.33 points, or 0.91%, at 927.23. The Nasdaq Composite Index was up 5.84 points, or 0.32%, at 1,844.06.
The S&P financial sector is up 36.6% in the last three months, while technology is up 20.1% and energy is up 10.9%.
Shares of home builders helped underpin the market on Monday after Credit Suisse raised its rating on KB Home, citing stronger orders and more attractive valuation. KB Home was up 5.1% at $14.11. The Dow Jones US Home Construction Index advanced 1.5 percent.
Wall Street’s eyes and ears also were on the news coverage of Bernie Madoff, who was sentenced to 150 years in prison on Monday for running what prosecutors called a $65 billion Ponzi scheme. When Madoff’s fraud was revealed last December, its scope was so brazen and so massive that it shocked investors and made everyone question their broker.
Signs of life in overseas markets added to Wall Street’s positive mood.
Shanghai’s benchmark stock index reached a one-year closing high for the fourth straight session as signs of a Chinese economic recovery and ample liquidity boosted the market, improving investor sentiment.
Crude oil futures jumped $2.33 to settle at $71.49 per barrel after Nigerian militants said they attacked the country’s oil facilities, which set off some concerns about supply.
For the day, the S&P energy index was up 1.3%, while Occidental Petroleum jumped 2.9% to $66.13.
On the Nasdaq, Microsoft Corp advanced 2.2% to $23.86 after Deutsche Bank raised its price target on the stock to $30 from $22.
Trading volume was below average on the New York Stock Exchange, with about 1.06 billion shares changing hands, far below last year’s estimated daily average of 1.49 billion, while on the Nasdaq, about 2.04 billion shares traded, below last year’s daily average of 2.28 billion.
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First Published: Tue, Jun 30 2009. 08 42 AM IST
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