Fri Mar 11, 2016 5:43pm EST
ECB stimulus, firmer oil push S&P 500 to 2016 high
DJ: 17,213.31 +218.18 NAS: 4,748.47
+86.31 S&P: 2,022.19
+32.62
(Reuters) The Dow
and S&P 500 rallied on Friday to their best close of 2016 as investors
embraced the European Central Bank's stimulus measures and steadying oil prices
drove up energy shares. Investors shook off skepticism over the
ECB's stimulus package disclosed on Thursday, which was overshadowed by signals
of an end to rate cuts, said Eric Kuby, chief investment officer at North Star
Investment Management Corp in Chicago.
"It
seemed to me this is yesterday's rally delayed until today," said
Kuby. Investors "reassessed and realized it was good news."
Friday's bullish session was also strengthened by steadying oil prices, which have
remained closely correlated with equities throughout the year.
U.S. crude was up almost
2 percent and Brent was
above $40 per barrel after the International Energy Agency said oil prices may
have bottomed as output in the United States and other non-OPEC
countries was beginning to fall quickly. The combined oil and natural gas U.S.
rig count fell to its lowest on records going back to 1940, according to data
from Baker Hughes.
The Dow Jones industrial
average .DJI rose 218.18 points, or 1.28 percent, to
17,213.31, the S&P 500 .SPX gained 32.62 points, or 1.64 percent,
to 2,022.19 and the Nasdaq Composite.IXIC added 86.31 points, or 1.85 percent, to
4,748.47. For the week, the Dow
rose 1.2 percent, the S&P gained 1.1 percent and the Nasdaq added 0.7
percent, marking the fourth consecutive positive week for the three indexes.
The cost of protection against a decline in the S&P 500, as
measured by the CBOE Volatility Index .VIX, hit its lowest this year.
The S&P 500 is now
down 1.1 percent for the year, staging a sharp recovery from a
selloff at the start of the year that was partly driven by a rout in oil.
The largest percentage gainer on the S&P 500 was Devon
Energy (DVN.N),
which rose 11.4 percent, while the largest decliner was Pepco Holdings (POM.N), down
9 percent.
Investors now turn their attention to the U.S. Federal Reserve,
which is set to meet on March 15-16 to decide on interest rates. The Fed has said it is on track to raise
rates gradually this year, but its decision will hinge on the health of the
economy. Recent data has shown the U.S. labor market remains strong but wage
growth remains a concern.
Advancing issues outnumbered declining ones on the NYSE by a
ratio of more than 5-to-1, and on the Nasdaq the ratio was 3.74-to-1 favoring
advancers.
The S&P 500 posted 39 new 52-week highs and one new low; the
Nasdaq recorded 69 new highs and 59 new lows.
About 7.5 billion shares
changed hands in U.S. exchanges, below the 8.5 billion daily over the last 20
sessions.
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