By Ellie Ismailidou and Barbara Kollmeyer, MarketWatch
Market shrugs off better-than-expected durable-goods data;
energy sector ends slightly higher
U.S. stocks closed with solid gains on Thursday as a rebound in
oil prices boosted the main benchmarks, which had been struggling
to hold on to small gains throughout the session.
The S&P 500 gained 22 points, or 1.1%, to 1,951, led by
financials and tech, up 1.4% and 1.3% respectively. The Dow Jones
Industrial Average added 212 points, or 1.3%, to 16,697, with all
30 of its components in positive territory, led by a 4.8% rise in
United Technologies Corporation (UTX).
Meanwhile, the Nasdaq Composite closed 40 points, or 0.9%,
higher at 4,582.
Oil prices
(http://www.marketwatch.com/story/crude-oil-steady-as-investors-weigh-latest-inventory-build-2016-02-25)
erased steep losses to end sharply higher Thursday, after news
reports said Venezuela's oil minister announced his country would
meet with fellow oil producers next month in an effort to stabilize
prices.
The recovery in oil prices sparked a stock-market rebound for a
second session in a row. On Wednesday, stocks closed with modest
gains
(http://www.marketwatch.com/story/dow-futures-slump-more-than-100-points-as-oil-dives-again-2016-02-24),
reversing sharper initial losses after a rebound in oil prices late
in the session.
Read:Low oil prices may signal end of economic weakness, not
beginning
(http://www.marketwatch.com/story/low-oil-prices-may-signal-end-of-economic-weakness-not-beginning-2016-02-24)
However, these moves are "unlikely to drive [equity] markets
higher in a sustainable way" while the oil market remains in a
supply glut and no major oil producer is willing to cut production,
said Karyn Cavanaugh, market strategist at Voya Investment
Management.
In fact, the energy sector was the worst performer on the
S&P 500, up 0.2%, while energy giant Chevron Corporation (CVX)
posted the worst performance on the Dow.
On the U.S. economic front, a report showed that January U.S.
orders for durable goods
(http://www.marketwatch.com/story/durable-goods-orders-surge-49-in-january-2016-02-25)
posted their biggest gain in 10 months, but did little to boost
stock-buying sentiment.
Within the report, shipments of nondefense capital goods
excluding aircraft were negative, in line with economists'
expectations. That figure is a closely watched barometer of broader
business demand and this reading could cut into the first-quarter
outlook for gross domestic product, according to Phil Orlando,
equity market strategist at Federated Investors, which could help
explain the market's muted reaction.
The data were "better than expected across the board," except
for "the only number in the durable-goods report that feeds in to
the gross domestic product," said Orlando.
Adding to the bearish sentiment Thursday was a 6.4% plunge for
the Shanghai Composite
(http://www.marketwatch.com/story/asian-stocks-mixed-as-china-prepares-for-g20-2016-02-24),
the biggest one-day percentage drop since Jan. 26. The selloff was
pinned on a range of reasons, including concerns about tighter
liquidity in the market and investors pulling money out of stocks
in the country.
"Comments by [the People's Bank of China's] deputy governor that
the bank expects oil imports to rise did very little to calm the
equity selloff," wrote Charalambos Pissouros, senior technical
analyst at IronFX Global, in a note to clients.
The Stoxx Europe 600 index surged 2% to break a two-day run of
losses
(http://www.marketwatch.com/story/european-stocks-on-track-to-break-two-day-run-of-losses-2016-02-25),
with bank and commodity shares catching a break from recent
declines. Markets were also starting to fixate on a Group of 20
meeting in Shanghai on Friday, where some expect China will address
worries about its economy.
Read:Everyone's on the hot seat as the G-20 comes to Shanghai
(http://www.marketwatch.com/story/everyones-on-the-hot-seat-as-g-20-comes-to-shanghai-2016-02-23)
Elsewhere, the dollar inched lower and gold ended flat
(http://www.marketwatch.com/story/gold-prices-take-a-breather-after-2-day-run-2016-02-25)
after a two-day gain.
Economy: The number of Americans who applied for unemployment
benefits
(http://www.marketwatch.com/story/jobless-claims-climb-10000-to-272000-2016-02-25)last
week rose slightly, the U.S. government said Thursday. But the
four-week average of claims fell to its lowest point since early
December, indicating that companies are sticking to current
employment levels despite slower U.S. economic growth and stock
market turmoil in early 2016.
Federal Reserve Bank of St. Louis President James Bullard
reiterated late Wednesday that the pressure has eased off
(http://www.marketwatch.com/story/feds-bullard-again-says-its-unwise-to-raise-rates-2016-02-24)
the central bank to raise rates. Then on Thursday, Bullard said in
an interview on CNBC that the U.S. central bank deserves some blame
for the stock-market selloff
(http://www.marketwatch.com/story/fed-deserves-some-blame-for-market-selloff-bullard-2016-02-25-81035252)in
the wake of its December interest-rate hike.
Stocks to watch: Best Buy Co. (BBY) reversed losses to close
2.4% higher despite the fact that the electronics retailer
announced profit in its latest quarter slid
(http://www.marketwatch.com/story/best-buy-profit-slides-warns-of-weak-sales-2016-02-25)
after sharp drops in demand for mobile phones.
Read: Warren Buffett's stock picks crush Carl Icahn's so far in
2016
(http://www.marketwatch.com/story/warren-buffetts-stock-picks-beat-carl-icahns-so-far-in-2016-2016-02-24)
Kohl's Corp. (KSS) met consensus on same-store sales and said it
would buy back up to $600 million of its own shares. The company's
shares gained 2.7%.
Campbell Soup Co. (CPB) gained 3.4% after its profit inched
higher
(http://www.marketwatch.com/story/campbell-soup-profit-rises-above-expectations-2016-02-25)
as falling expenses offset a decline in revenue.
Kraft Heinz Co. (KHC), Gap Inc. (GPS) and Intuit Inc. (INTU)
earnings are due after the close.
Foxconn Technology Co. (2354.TW) assembler for Apple Inc.'s
(AAPL) iPhones, said Thursday that it is delaying the signing of a
takeover deal with Sharp Corp. (6753.TO). Citing sources, The Wall
Street Journal said
(http://www.wsj.com/articles/sharp-accepts-foxconns-6-25-billion-takeover-offer-1456367642)
the deal was put on ice after Foxconn reviewed future financial
risk for Sharp. Foxconn inched 0.3% higher while Sharp lost
14%.
(END) Dow Jones Newswires
February 25, 2016 16:27 ET (21:27 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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