Stocks’ day mostly pos­i­tive af­ter big spike in oil prices

Austin American-Statesman - - BUSINESS -

U.S. stock in­dexes closed mostly higher Wed­nes­day af­ter a sharp in­crease in crude oil prices helped drive mar­ket-lead­ing gains for en­ergy com­pa­nies.

Banks and other fi­nan­cial stocks de­clined the most as bond yields headed lower, which trans­lates into lower in­ter­est rates on loans and lower prof­its for banks.

The Dow Jones in­dus­trial av­er­age ended in the red, while the Stan­dard & Poor’s 500 in­dex and Nas­daq com­pos­ite eked out mod­est gains. Two stocks rose for every one that fell on the New York Stock Ex­change.

“Af­ter yes­ter­day’s bounce back, you’re see­ing a lit­tle side­ways ac­tion to­day,” said Jeff Zip­per, man­ag­ing di­rec­tor at the Pri­vate Client Re­serve of U.S. Bank.

The S&P 500 in­dex added 2.56 points, or 0.1 per­cent, to 2,361.13. The Dow fell 42.18 points, or 0.2 per­cent, to 20,659.32. The Nas­daq com­pos­ite in­dex gained 22.41 points, or 0.4 per­cent, to 5,897.55.

Bond prices rose. The 10-year Trea­sury yield fell to 2.39 per­cent from 2.42 per­cent.

A day af­ter Wall Street ral­lied on news that U.S. con­sumer con­fi­dence reached its high­est level since 2000, the mar­ket got an­other dose of en­cour­ag­ing eco­nomic data Wed­nes­day.

The Na­tional As­so­ci­a­tion of Real­tors said more peo­ple signed con­tracts to buy U.S. homes last month as warm weather and ris­ing con­fi­dence ap­peared to en­cour­age con­sumers to look for houses. The NAR’s pend­ing home sales in­dex climbed 5.5 per­cent in Fe­bru­ary to 112.3, its high­est point since April and its sec­ond-high­est point since 2006.

In­vestors are hop­ing that Congress and the White House will en­act tax cuts and other busi­ness-friendly pol­icy pro­pos­als promised by President Don­ald Trump dur­ing his cam­paign.

Those ex­pec­ta­tions helped lift the mar­ket in the weeks af­ter the elec­tion last Novem­ber.

But some of that in­vestor op­ti­mism dimmed in re­cent weeks af­ter the Trump ad­min­is­tra­tion’s bid to pass a bill in­tended to be­gin re­peal­ing the Af­ford­able Care Act failed to win enough votes.

“It’s re­ally wait-and-see with the fo­cus back on Wash­ing­ton and tax re­form,” Zip­per said.

Out­side of Wash­ing­ton, in­vestors had their eye on the lat­est com­pany earn­ings news. In­vestors bid up shares in sev­eral com­pa­nies that posted solid quar­terly re­sults or out­looks.

RH, for­merly Restora­tion Hard­ware, climbed 14.9 per­cent a day af­ter the home fur­nish­ings and decor re­tailer re­ported stronger earn­ings. It added $5.68 to $43.68.

Verint Sys­tems jumped 10 per­cent af­ter the soft­ware com­pany re­ported bet­ter-than-ex­pected quar­terly re­sults.

Verint also said dur­ing a man­age­ment con­fer­ence call with an­a­lysts that it is pos­si­ble that at some point it will split it­self into two busi­nesses, but noted it has no plans now to do that. Verint’s stock rose $3.95 to $43.50.

Traders also wel­comed news of other cor­po­rate deals.

Exar surged 22.3 per­cent af­ter MaxLin­ear agreed to buy the chip­maker for $13 per share, or $662 mil­lion. Shares in Exar gained $2.37 to $12.99. MaxLin­ear rose $1.55, or 5.8 per­cent, to $28.06.

Some com­pa­nies’ quar­terly re­port cards failed to im­press traders.

Dave & Buster’s En­ter­tain­ment fell 3.4 per­cent af­ter the ar­cade and restau­rant chain an­nounced dis­ap­point­ing sales at older lo­ca­tions. The stock gave up $2.10 to $60.09.

En­ergy prices closed sharply higher as traders weighed re­marks from Iran’s oil min­is­ter.

Oil prices climbed af­ter Bi­jan Zan­ganeh said the re­cent pro­duc­tion-cut deal will prob­a­bly be ex­tended, and fight­ing in Libya is af­fect­ing its oil in­dus­try.

Bench­mark U.S. crude oil fu­tures rose $1.14, or 2.4 per­cent, to close at $49.51 a bar­rel in New York. The con­tract rose 64 cents Tues­day.

Brent crude, used to price in­ter­na­tional oils, climbed $1.09, or 2.1 per­cent, to close at $52.42 a bar­rel in Lon­don.

RICHARD DREW / AS­SO­CI­ATED PRESS

Trader An­thony Ric­cio (left) and spe­cial­ist Dilip Pa­tel work Wed­nes­day at the New York Stock Ex­change. The ma­jor in­dexes ended the day mixed, with the Dow down, and the S&P and Nas­daq up.

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