Stocks end mostly lower

Bond mar­ket takes heavy losses while banks, en­ergy post gains

The Denver Post - - BUSINESS - By Mar­ley Jay and Ken Sweet

Stocks moved mostly lower Wed­nes­day as gains in blue-chip en­ergy com­pa­nies and banks were not enough to make up for losses in the broader mar­ket.

The bond mar­ket took heavy losses, with the 10-year U.S. Trea­sury note ris­ing to its high­est level in a year and a half. The higher yields sent bond sub­sti­tutes such as utilities, telecom­mu­ni­ca­tions and real es­tate stocks sharply lower.

Oil stocks climbed after OPEC na­tions, which col­lec­tively pro­duce more than onethird of the world’s oil, agreed to trim production for the first time in eight years.

The Stan­dard & Poor’s 500 in­dex lost 5.85 points, or 0.3 per­cent, to 2,198.81 and the Nas­daq com­pos­ite dropped 56.24 points, or 1.1 points, to 5,323.68.

The 30-mem­ber Dow Jones in­dus­trial av­er­age closed up 1.98 points, or 0.01 per­cent, to 19,123.58. The gain was at­trib­ut­able to big in­creases in a hand­ful of Dow com­po­nents, mainly Gold­man Sachs, Chevron and DuPont.

The bond and en­ergy mar­kets saw the most drama Wed­nes­day. Bond prices fell sharply yet again and the 10-year note’s yield rose to 2.38 per­cent from 2.29 per­cent on Tues­day, a ma­jor move for that mar­ket. That yield is now trad­ing at its high­est level since July 2015.

In en­ergy, OPEC mem­bers fi­nal­ized a deal that will cut their oil out­put by 1.2 mil­lion bar­rels a day start­ing in Jan­uary. Pre­lim­i­nary terms of the deal were an­nounced in Septem­ber. The price of U.S. crude surged $4.21, or 9.3 per­cent, to close at $49.44 a bar­rel in New York. Brent crude, the in­ter­na­tional bench­mark, gained $4.09, or 8.8 per­cent, to $50.47 a bar­rel in Lon­don.

Higher oil prices mean more rev­enue for com­pa­nies that ex­tract or sell oil, and en­ergy com­pa­nies made big gains Wed­nes­day. Exxon Mo­bil picked up $1.40, or 1.6 per­cent, to $87.30 and Chevron rose $2.22, or 2 per­cent, to $111.56.

More special­ized oil com­pa­nies, par­tic­u­larly drillers and oil ex­plo­ration com­pa­nies and com­pa­nies who sup­port drillers, soared. Marathon Oil leaped $3.11, or 20.1 per­cent, to $18.06. Ocean rig op­er­a­tor Transocean jumped $1.88, or 17 per­cent, to $12.90.

Gold­man Sachs rose $7.54, or 3.6 per­cent, to $219.29 and JPMor­gan Chase added $1.25, or 1.6 per­cent, to $80.17.

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