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Wall Street higher as energy stocks gain on oil rally

Business Materials 9 May 2018 20:24 (UTC +04:00)
Wall Street was higher on Wednesday, with energy shares getting a boost from a surge in oil prices after President Donald Trump pulled the United States out of a nuclear deal with Iran.
Wall Street higher as energy stocks gain on oil rally

Wall Street was higher on Wednesday, with energy shares getting a boost from a surge in oil prices after President Donald Trump pulled the United States out of a nuclear deal with Iran, according Reuters.

The S&P energy index .SPNY rose 1.9 percent after oil prices hit their highest levels in 3-1/2 years as investors worried that Trump’s decision would increase risks of conflict in the Middle East and curtail oil supplies in a tight market.

The energy sector has risen more than 10 percent so far in the quarter, far outperforming the other major S&P indexes.

However, a 3.5 percent drop in Walmart (WMT.N) limited gains on the Dow after the retailer took a majority stake in Indian e-commerce firm Flipkart for about $16 billion.

“Oil is probably not helping, it’s a kind of a potential inflation indicator,” said Mark Travis, chief executive officer of Intrepid Capital Funds in Jacksonville Beach, Florida.

“The underlying challenge for the financial markets is not so much whether Trump does or doesn’t do anything. It is the impact of the rates rising facing an expensive capital markets.”

The US 10-year Treasury yield US10YT=RR rose to a two-week high and above the key 3 percent level on expectations of higher interest rates. [US/]

At 11:24 a.m. EDT the Dow Jones Industrial Average .DJI was up 18.37 points, or 0.08 percent, at 24,378.58, the S&P 500 .SPX was up 7.16 points, or 0.27 percent, at 2,679.08 and the Nasdaq Composite .IXIC was up 9.96 points, or 0.14 percent, at 7,276.87.

Six of the 11 major S&P sectors were higher, with the financial sector’s .SPSY 0.6 percent rise providing the second biggest boost to the benchmark index.

The yield-sensitive utilities .SPLRCU and telecom services .SPLRCL were down about 0.7 percent each.

Walt Disney (DIS.N) dipped 2.1 percent. The media company, which is in the process of buying film and TV assets from Twenty-First Century Fox (FOXA.O), reported quarterly profit that topped Wall Street forecasts.

Advancing issues outnumbered decliners by a 1.06-to-1 ratio on the NYSE. Advancing issues outnumbered decliners by a 1.06-to-1 ratio on the Nasdaq.

The S&P index recorded 28 new 52-week highs and 9 new lows, while the Nasdaq recorded 119 new highs and 37 new lows.

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