By February 17, 2016 Read More →

Oil prices, factory output up, stocks climbing

Oil prices up after losses on Tuesday

oil prices

Oil prices gained as investors hoped for an international deal that would cap or cut production.  Repsol photo.

NEW YORK _ U.S. stocks are jumping as the price of oil climbs sharply, and they are on pace for their third gain in a row. Energy companies including Chevron are rising, and tech companies are posting big increases led by Microsoft and Facebook.

KEEPING SCORE: The Dow Jones industrial average rose 251 points, or 1.7 per cent, to 16,458 as of 3:40 p.m. Eastern time. The Standard & Poor’s 500 index gained 31 points, or 1.6 per cent, to 1,926. The Nasdaq composite added 91 points, or 2.1 per cent, to 4,527.

On Thursday the S&P 500 closed at its lowest level of the year, down more than 10 per cent in 2016. In the last three days it has recovered about half of that loss.

OIL REBOUNDS: The price of oil recovered as investors again hoped for an international deal that will cap or cut production. Several OPEC nations are in talks about a freeze, but Iran said Wednesday it won’t stop increasing its exports. Still, investors appeared to be encouraged that the countries are talking.

The price of U.S. crude jumped $1.62, or 5.6 per cent, to $30.66 a barrel in New York. Brent crude, a benchmark for international oils, rose $2.32, or 7.2 per cent, to $34.50 a barrel in London.

On Tuesday Russia and Saudi Arabia agreed to keep oil production at January’s levels, but the deal will only take effect if other OPEC nations agree to it. Iran wants to raise output following the lifting of sanctions. U.S. crude surged 12 per cent Friday on anticipation of a deal, but it slipped Tuesday. U.S. oil has fallen 17 per cent this year.

ENERGY AND TECH LEAD: Energy stocks climbed with the price of oil. Chevron rose $3.27, or 3.8 per cent, to $88.08 and Hess picked up $2.54, or 6.2 per cent, to $43.38. Tech stocks made big gains, led by Microsoft, which added $1.32, or 2.6 per cent, to $52.41, and Facebook, which rose $3.63, or 3.6 per cent, to $105.24.

PRICELINE IS RIGHT: Online travel company Priceline climbed after its profit and revenue surpassed estimates. The stock gained $124.88, or 11.2 per cent, to $1,235.56. Expedia rose almost 5 per cent and TripAdvisor 3.5 per cent. Expedia and TripAdvisor also climbed recently after posting strong results.

THE RIGHT DIRECTION: Personal navigation device maker Garmin rose $5.01, or 14.2 per cent, to $40.24 after its fourth-quarter profit topped Wall Street estimates.

SET YOUR WATCHES: Watch and accessories maker Fossil Group posted profit and revenue that were far better than expected, and its annual profit guidance also pleased investors. The stock added $8.76, or 25.4 per cent, to $43.22.

Fossil was one of the worst-performing stocks on the S&P 500 last year. It lost almost two-thirds of its value as fitness trackers became more popular and the Apple Watch was launched.

DEVON DIVES: Oil and natural gas company Devon Energy tumbled after saying it will eliminate 20 per cent of its staff in the first quarter and slash its spending and its quarterly dividend in response to the diminished price of oil.

The stock lost $1.24, or 5.8 per cent, to $20.02. It’s down about 70 per cent over the last year.

TRANSUNION CLIMBS: Credit rating company TransUnion jumped after its fourth-quarter results were better than expected and its outlook for 2016 was also stronger than analysts anticipated. The stock rose $3.80, or 17.8 per cent, to $25.16. TransUnion is now trading above its IPO price of $22.50 a share.

BUFFETT BOOST: Pipeline company Kinder Morgan got a boost from the rise in oil prices and from the news that Warren Buffett’s Berkshire Hathaway has taken a 1.2-per cent stake in the company. The stock advanced $1.51, or 9.7 per cent, to $17.13.

POWERING UP: U.S. factories cranked out more cars, furniture and food in January. The Federal Reserve said factory output rose 0.5 per cent, the biggest increase since July. Output had fallen in four of the previous five months.

The data suggests U.S. manufacturing may be recovering after struggling last year. While the strong dollar and weak overseas growth have cut into exports and corporate profits, Americans are also spending at a solid pace.

OTHER ENERGY TRADING: Wholesale gasoline rose 3.3 cents to $1 a gallon. Heating oil rose 6.1 cents, or 5.9 per cent, to $1.088 a gallon. Natural gas added 3.9 cents, or 2 per cent, to $1.942 per 1,000 cubic feet.

METALS: The price of gold rose $3.20 to $1,211.40 an ounce and silver inched up 4.3 cents to $15.377 an ounce. Copper added 2.5 cents to $2.076 a pound.

EUROPE: Germany’s DAX rose 2.7 per cent and France’s CAC 40 gained 3 per cent. Britain’s FTSE 100 was up 2.9 per cent.

ASIA’S DAY: Japan’s Nikkei 225 fell 1.4 per cent as investors shrugged off data showing strong machinery orders in January. Hong Kong’s Hang Seng dropped 1 per cent while the Shanghai Composite rose 1.1 per cent.

CURRENCIES: The yield on the 10-year Treasury note jumped to 1.83 per cent from 1.78 per cent. The dollar rose to 114.24 yen from 113.88 yen. The euro slipped to $1.114 from $1.144.

The Canadian Press

Posted in: Energy Financial

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