US stocks finish higher on falling oil prices
A continued slide in oil prices gave Wall Street a moderate advance today, with the major indexes ending the week more than 1% higher, their third straight winning week.
Volume was light with the Treasury market closed for Veterans’ Day and many traders taking the day off. Today’s advance was fuelled by momentum from three weeks of strong gains, said Jay Suskind, head trader at Ryan, Beck & Co.
“I think it’s going to be tough to draw conclusions because of the lack of participation,” he said. “Next week, you’ll start to hear about technical levels of the indices. People will be wondering, ‘Can we break through and really continue this year-end rally ?’.”
Mr Suskind added that lower oil is improving the consumer picture ahead of the critical holiday shopping season. A recent slide in crude futures has eased worries that record petrol prices will eat into household income and weigh on year-end retail spending.
The Dow Jones industrial average gained 45.94, or 0.43%, to 10,686.04, its highest close since August 3. The Dow added more than 93 points in the previous session.
Broader stock indicators were also higher. The Standard & Poor’s 500 index was up 3.76, or 0.31%, at 1,234.72, and the Nasdaq composite index climbed 5.79, or 0.26%, to 2,202.47.
The US government bond market was closed for the holiday. Yesterday, a record Treasury auction carried bonds sharply higher after falling to eight-month lows last week. The dollar was mixed against other major currencies, and gold prices inched upward.
Crude oil has dropped to its lowest levels since the summer following recent reports of expanding supplies and weaker demand. A barrel of light crude was down 27 cents to settle at 57.53 dollars on the New York Mercantile Exchange.
Wall Street posted a third straight week of sturdy gains despite a shortage of economic or earnings data to guide investors. But next week brings key monthly reports on inflation, retail sales and industrial activity. Traders will be watching the numbers closely for any signs of where the market might be headed.
For the week, the Dow advanced 1.47%, the S&P 500 added 1.19% and the Nasdaq was higher by 1.52%.
Ed Peters, chief investment strategist for PanAgora Asset Management, said he believes the market will make a final push – not just because of the traditional year-end rally, but also as positive economic numbers brighten investors’ moods.
“By December, we will have a much clearer idea of the impact of the hurricanes, and of higher oil prices,” he said. “I think the market will find it overreacted. We’ll probably see an improvement.”
Declining issues led advancers for most of the session, but advancers overtook decliners by 9 to 7 on the New York Stock Exchange. NYSE volume of 1.29 billion shares lagged the 1.75 billion shares traded yesterday.
The Russell 2000 index of smaller companies rose 1.73, or 0.26%, to 666.66.
