US close: Stocks end in the black; Dow and S&P 500 hit fresh records
US stocks ended in the black on Tuesday as oil prices advanced and investors welcomed signs of further central bank stimulus, following better-than-expected earnings from industrial bellwether Alcoa.
The Dow Jones Industrial Average and the S&P 500 closed at fresh records, up 0.7%, while the Nasdaq also ended the session 0.7% firmer.
Surging oil prices lent support, with West Texas Intermediate up 4.5% to $46.77 per barrel and Brent crude up 4.5% to $48.35. Oil was given a boost after the Organization of Petroleum Exporting Countries said in a monthly report that non-OPEC output would fall by 880,000 barrels a day this year. Also on Tuesday, the Energy Information Administration said it expects non-OPEC production to fall more than previously estimated in 2016.
Receding fears about Brexit lent a hand as investors continued to cheer news that Theresa May was set to succeed David Cameron as Prime Minister of the UK this week.
In addition, comments from Japanese Prime Minister Shinzo Abe, who promised on Tuesday to stimulate the country’s economy, improved the mood. Abe, whose ruling party and coalition won a majority in upper-house elections on Sunday, said he wants “the swift formulation of comprehensive, bold economic measures".
Investors were also looking ahead to Thursday’s Bank of England rate announcement amid growing expectations of a rate cut in the wake of the UK’s decision to leave the European Union.
Bank of America Merrill Lynch said it expects the BoE to cut interest rates by at least 25 basis points, saying the central bank had nothing to gain by waiting.
On the corporate front, shares in Alcoa continued to rally a day after the aluminium giant reported quarterly earnings and revenue that surpassed analysts’ forecasts.
Fastenal, on the other hand, slumped after reporting an unexpected drop in second quarter profit.
Elsewhere, US-listed shares of Shire rallied after the US Food and Drug Administration approved its lifitegrast eye drops for treating signs and symptoms of dry eye disease.
Later this week, major banks are due to report including JP Morgan Chase & Co., Citigroup and Wells Fargo & Co.
Seagate Technology surged after it announced late on Monday that it will cut 6,500 jobs globally, or around 14% of its workforce.
Meanwhile, St. Louis Fed President James Bullard on Tuesday reiterated in a speech that he reckons only a single interest rate increase will be needed for the foreseeable future.
Fellow Fed official Daniel Tarullo urged better regulation of short-term funding both inside and outside the banking system in a separate speech in Washington.
In economic data, NFIB’s small business optimism index rose to 94.5 in June from 93.8 a month earlier, beating expectations for 94.0.
Elsewhere, US wholesale inventories rose 0.1% in May compared to a month ago, the Department of Commerce said, following an upwardly revised 0.7% increase in April. Analysts had expected a 0.2% gain.
The Labor Department revealed in its Job Openings and Labor Turnover Survey that the number of job openings fell by 345,000 to 5.5m in May, driven by a decline in the private sector. The job openings rate was at 3.7% in May.
The number of hires was little changed at 5m at a rate of 3.5%. Hiring within private and government were broadly stable.
S&P 500 - Risers
Seagate Technology Plc (STX) $29.35 +21.83%
American Airlines Group (AAL) $34.66 +11.23%
Freeport-McMoRan Inc (FCX) $12.90 +10.73%
Southwestern Energy Co. (SWN) $14.20 +10.08%
Chesapeake Energy Corp. (CHK) $4.58 +9.57%
Transocean Ltd. (RIG) $12.84 +9.00%
United Continental Holdings Inc. (UAL) $46.16 +8.84%
Murphy Oil Corp. (MUR) $32.10 +7.94%
Hess Corp. (HES) $60.13 +7.24%
Diamond Offshore Drilling Inc. (DO) $26.11 +6.96%
S&P 500 - Fallers
Fastenal Co. (FAST) $43.79 -3.46%
Newmont Mining Corp. (NEM) $39.96 -2.68%
Eversource Energy (ES) $57.88 -2.44%
Reynolds American Inc. (RAI) $51.96 -2.33%
Kraft Heinz Co. (KHC) $87.80 -2.27%
Church Dwight Co Inc. (CHD) $99.57 -2.08%
Xcel Energy Inc. (XEL) $43.50 -2.05%
Pinnacle West Capital Corp. (PNW) $79.44 -2.02%
Regeneron Pharmaceuticals Inc. (REGN) $368.75 -1.86%
Wisconsin Energy Corp. (WEC) $63.71 -1.85%
Dow Jones I.A - Risers
Goldman Sachs Group Inc. (GS) $156.92 +3.11%
E.I. du Pont de Nemours and Co. (DD) $65.94 +2.65%
Caterpillar Inc. (CAT) $79.80 +2.57%
Nike Inc. (NKE) $58.06 +2.16%
Intel Corp. (INTC) $34.94 +1.63%
JP Morgan Chase & Co. (JPM) $63.20 +1.49%
American Express Co. (AXP) $63.00 +1.35%
Chevron Corp. (CVX) $106.78 +1.32%
Visa Inc. (V) $77.48 +1.25%
Microsoft Corp. (MSFT) $53.21 +1.18%
Dow Jones I.A - Fallers
Wal-Mart Stores Inc. (WMT) $73.27 -1.07%
Boeing Co. (BA) $130.81 -0.93%
Verizon Communications Inc. (VZ) $55.47 -0.82%
Unitedhealth Group Inc. (UNH) $139.86 -0.33%
Home Depot Inc. (HD) $134.84 -0.23%
Travelers Company Inc. (TRV) $118.09 -0.03%
Johnson & Johnson (JNJ) $122.92 -0.01%
Nasdaq 100 - Risers
Seagate Technology Plc (STX) $29.35 +21.83%
American Airlines Group (AAL) $34.66 +11.23%
Illumina Inc. (ILMN) $148.99 +6.70%
Western Digital Corp. (WDC) $51.84 +4.77%
Micron Technology Inc. (MU) $13.23 +4.67%
Liberty Global plc Series A (LBTYA) $30.60 +4.15%
Liberty Global plc Series C (LBTYK) $29.87 +3.86%
Autodesk Inc. (ADSK) $57.38 +3.41%
Norwegian Cruise Line Holdings Ltd. - Ordinary Shares (NCLH) $44.55 +3.22%
NetApp Inc. (NTAP) $25.16 +3.03%
Nasdaq 100 - Fallers
Fastenal Co. (FAST) $43.79 -3.46%
Kraft Heinz Co. (KHC) $87.80 -2.27%
Regeneron Pharmaceuticals Inc. (REGN) $368.75 -1.86%
Biomarin Pharmaceutical Inc. (BMRN) $87.48 -1.25%
Check Point Software Technologies Ltd. (CHKP) $81.45 -1.25%
Baidu Inc. (BIDU) $164.98 -1.23%
Sirius XM Holdings Inc (SIRI) $4.10 -0.97%
Walgreens Boots Alliance, Inc. (WBA) $81.22 -0.96%
T-Mobile Us, Inc. (TMUS) $43.64 -0.91%
Amazon.Com Inc. (AMZN) $748.21 -0.74%