Stock Market News for February 03, 2015 – February 3, 2015 – Zacks …
Benchmarks ended Monday’s volatile trading session with solid gains after a rally in oil prices boosted energy shares. An offer from Greece’s finance minister to end the standoff with its international creditors over the country’s debt was also welcomed by investors. Monday’s solid gains came in after the S&P 500 and the Dow posted their biggest monthly loss in almost a year in January.
For a look at the issues currently facing the markets, make sure to read today’s Ahead of Wall Street article
The Dow Jones Industrial Average (DJI) rose 1.1%, or 196.09 points, to close at 17,361.04. The Standard & Poor 500 (S&P 500) gained 1.3% to close at 2,020.85. The tech-laden Nasdaq Composite Index closed at 4,676.69; rising 0.9%. The fear-gauge CBOE Volatility Index (VIX) declined 7.3% to settle at 19.43. A total of about 7.7 billion shares were traded on Monday, above last five sessions’ average of 7.4 billion. Advancers outpaced declining stocks on the NYSE. For 71% stocks that advanced, 26% declined.
Oil prices moved north on Monday. The prices of WTI crude oil and Brent crude oil increased 2.7% and 3.2% to $49.57 per barrel and $54.75 a barrel, respectively. Oil prices climbed about 11% over the last two trading sessions after investors believe prices have touched the bottom. Abundant supply of oil has dragged oil prices down over 50% since mid-June last year.
The Energy Select Sector SPDR (XLE) gained 3.1%. The sector gained the most among the S&P 500 sectors. Shares of key energy stocks including Chevron Corporation (CVX – Analyst Report), Schlumberger Limited (SLB – Analyst Report), Kinder Morgan, Inc. (KMI – Analyst Report) and Occidental and Petroleum Corporation (OXY – Analyst Report) increased 3.4%, 2.7%, 1.4% and 0.2%, respectively. Meanwhile, shares of Exxon Mobil Corporation (XOM – Analyst Report) advanced 2.5% after posting fourth-quarter 2014 earnings of $1.56 per share that beat the Zacks Consensus Estimate of $1.33.
The Financial Select Sector SPDR (XLF) gained 1.6%, the second highest among the S&P 500 sectors. Leading companies from the sector such as Wells Fargo & Company (WFC – Analyst Report), JPMorgan Chase & Co. (JPM – Analyst Report), Berkshire Hathaway Inc. (BRK-B), Bank of America Corporation (BAC – Analyst Report) and Citigroup Inc. (C – Analyst Report) increased 1.7%, 2%, 1.9%, 2.1% and 1.6%, respectively. All 10 sectors of the S&P 500 ended in the green.
Investors chose to focus on yesterday’s rally in oil prices and looked past discouraging reports on U.S. consumer spending and manufacturing sector. Consumer spending in December registered its biggest drop since 2009. According to the Bureau of Economic Analysis, personal consumption expenditure decreased 0.3% in December, more than the consensus estimate of a decline by 0.2%. This drop in personal spending came after it had increased 0.5% in November. However, personal income increased 0.3% in December, more than the consensus estimate of a 0.2% gain. This rise in personal income came after it had increased 0.3% in November.
Meanwhile, the ISM Manufacturing Index reported its weakest reading in almost one year in January. The Institute for Supply management reported its January PMI had decreased 1.6 percentage points from December’s adjusted reading of 55.1% to 53.5%. The fall to 53.5% in January was more than the consensus estimate of a decrease to 54.6%.
Separately, the US Census Bureau of the Department of Commerce reported construction spending of $982.1 billion in December. This was 0.4% higher than the revised November estimate of $978.6 billion. Gains in home building activity and government construction were cited to be the primary reasons for this increase in construction spending. However, this increase in the payout by builders on residential and nonresidential structures was less than the consensus estimate of an increase of 0.7%.
Encouraging news emanating from Greece was also welcomed by investors. Greece’s finance minister Yanis Varoufakis proposed to end the standoff between its international creditors by swapping the country’s debt obligations for new growth-linked bonds. Yanis Varoufakis said: “What I’ll say to our partners is that we are putting together a combination of a primary budget surplus and a reform agenda…. I’ll say, ‘Help us to reform our country and give us some fiscal space to do this, otherwise we shall continue to suffocate and become a deformed rather than a reformed Greece.”
Last Friday, Yanis Varoufakis had rejected the country’s extended bailout program. Yanis Varoufakis also refused to co-operate with the European Union and the International Monetary Fund.
Taken from –
Stock Market News for February 03, 2015 – February 3, 2015 – Zacks …
