Stocks rise as traders weigh new data, oil prices
Stocks rose Wednesday, the last full trading day of the week, as investors eyed a recovery in oil prices and data releases.
The Dow Jones industrial average gained about 130 points, with Chevron contributing the most to gains. Nike struggled to hold higher after initially rallying.
Nike reported earnings that beat but revenue that missed slightly. The athletic footwear and apparel maker’s stock got a particular boost in after-hours trade from a 20 percent increase in future orders, a number which excludes the impact of currency fluctuations.
The energy sector gained about 2 percent to lead all S&P 500 sectors higher in the open. Materials was the second-best advancer.
“It’s an oil-driven rally this morning,” said Peter Cardillo, chief market economist at First Standard Financial.
Oil prices attempted to recover from multi-year lows touched recently, with U.S. crude climbing above $37 a barrel to its highest level in a week.
U.S. crude prices rose to a premium over internationally traded Brent on Wednesday. U.S. inventories released by the American Petroleum Institute showed a surprise dip.
Official inventory data from the EIA will be published later on Wednesday.
“It’s been reasonably strong (for stocks) all week. I don’t know if it’s because of any phenomenal economic statistics, although it’s comforting the U.S. consumer is reasonably strong,” said Ben Pace, chief investment officer at HPM Partners.
There’s a “natural tendency for a year-end rally. I hate to just attribute it to that,” he said, also noting a “calming of the fears in the high-yield junk bond market.”
Both the SPDR Barclays High Yield Bond ETF (JNK) and iShares iBoxx USD High Yield Corporate Bond ETF (HYG) traded higher Wednesday morning but are down about 10 percent or more for the year so far.
Durable goods orders were unchanged in November. U.S. personal income rose 0.3 percent.
In the 12 months through November, the personal consumption expenditures (PCE) price index was up 0.4 percent after rising 0.2 percent in October, Reuters said. Excluding food and energy, prices nudged up 0.1 percent after being unchanged in October. The so-called core PCE price index rose 1.3 percent in the 12 months through November, for the 11th straight month.
U.S. consumer spending rose by 0.3 percent last month after holding steady in October, according to figures inadvertently released late on Tuesday by the Commerce Department. The data was originally due for release at 8:30 a.m. Wednesday.
Treasury yields traded higher, with the 2-year yield near 0.98 percent and the 10-year yield at 2.26 percent.
The U.S. dollar traded mildly higher, with the euro near $1.09 and the yen at 120.88 yen against the greenback as of 9:46 a.m., ET.
Also due is the final University of Michigan consumer sentiment survey for December, and, following Tuesday’s weak existing home sales numbers, new home sales figures for November at 10:00 a.m. ET.
Wednesday is the last full trading day of the week, as Thursday is a half day for the Christmas Eve holiday. Markets are closed Friday for Christmas Day.
In morning trade, the Dow Jones industrial average traded up 125 points, or 0.71 percent, at 17,540, with Chevron and Nike leading advancers and Disney the only decliner.
The S&P 500 traded up 12 points, or 0.59 percent, at 2,051, with energy leading all 10 sectors higher.
The Nasdaq composite traded up 25 points, or 0.49 percent, at 5,025.
About eight stocks advanced for every decliner on the New York Stock Exchange, with an exchange volume of 53 million and a composite volume of 138 million.
U.S. crude oil for February delivery traded up 98 cents at $37.11 a barrel on the New York Mercantile Exchange. Gold futures for February delivery fell $4.30 to $1,069.80 an ounce.
CNBC’s Peter Schacknow contributed to this report.