En­ergy, bank­ing stocks show solid daily gains

Ris­ing bond yields give boost to fi­nan­cial firms; in­vestors back com­pa­nies with strong re­ports.

The Denver Post - - BUSINESS - By Alex Veiga The As­so­ci­ated Press

Banks and other fi­nan­cial com­pa­nies led U.S. stocks mod­estly higher Thurs­day, nudg­ing the Nas­daq com­pos­ite in­dex to an all- time high.

Ris­ing bond yields, which can re­sult in higher in­ter­est rates on loans and big­ger prof­its for banks, helped put traders in the mood to buy bank­ing stocks. En­ergy com­pa­nies also notched gains as crude oil prices rose. Util­i­ties and other high­div­i­dend stocks fell.

In­vestors also bid up shares in com­pa­nies that re­leased strong quar­terly re­sults or an­nounced big trans­ac­tions.

“Eq­ui­ties are end­ing the first quar­ter in a rea­son­ably good place,” saidTerry Sand­ven, chief eq­uity strate­gist at U. S. Bank Wealth Man­age­ment. “I do think eq­ui­ties trend side­ways, prob­a­bly for the next month. The rally since the elec­tion has cen­tered around im­proved sen­ti­ment re­gard­ing tax re­form and in­fra­struc­ture spend­ing, and that’s still a work in progress.”

Bond prices edged lower. The 10- year Trea­sury yield rose to 2.41 per­cent from 2.38 per­cent late Wed­nes­day.

“To­day’s ac­tion and the lit­tle bit of strength we’ve seen the past cou­ple of days is maybe in­vestors fo­cus­ing a lit­tle bit more on fun­da­men­tals and the fact that the econ­omy and earn­ings are in the same tra­jec­tory as they were two weeks ago when the mar­kets were at all- time highs, and we’re slightly be­low that,” said Sean Lynch, co- head of global eq­uity strat­egy at Wells Fargo In­vest­ment In­sti­tute.

Fi­nan­cial sec­tor stocks rose 1.2 per­cent, the big­gest gain among the 11 sec­tors in the S& P 500. The sec­tor, which is up 2.8 per­cent this year, ac­counted for more than half the in­dex’s gains Thurs­day.

Traders bid up shares in big banks such as Cap­i­tal One Fi­nan­cial, which rose $ 2.46, or 2.9 per­cent, to $ 87.14.

Conoco Phillips jumped af­ter the en­ergy com­pany agreed to sell most of its Cana­dian as­sets to Canada’s Cen­ovus En­ergy in a deal val­ued at $ 13.2 bil­lion. The stock was the big­gest gainer in the S& P 500 in­dex, climb­ing $ 4.05 to $ 50.

Ex­treme Net­works surged 14.2 per­cent af­ter the net­work in­fra­struc­ture equip­ment maker agreed to buy a data cen­ter, switch­ing, rout­ing and an­a­lyt­ics busi­ness from Bro­cade Com­mu­ni­ca­tions once Bro­cade is ac­quired by Broad­com. Shares in Ex­treme Net­works rose 92 cents to $ 7.38.

Other com­pa­nies failed to im­press traders. Lu­l­ule­mon sank 23.4 per­cent a day af­ter the yoga cloth­ing com­pany’s fore­cast for the quar­ter fell well short of Wall Street’s ex­pec­ta­tions. The stock slid $ 15.54 to $ 50.76.

Sci­ence Ap­pli­ca­tions In­ter­na­tional tum­bled 13.1 per­cent af­ter the in­for­ma­tion tech­nol­ogy com­pany’s lat­est quar­terly re­sults missed es­ti­mates. The com­pany cited a va­ri­ety of prob­lems, in­clud­ing de­lays and de­clines in con­tract work. The stock lost $ 11.28 to $ 74.97.

In en­ergy fu­tures trad­ing, bench­mark U. S. crude oil rose 84 cents, or 1.7 per­cent, to close at $ 50.35 a bar­rel in New York. Brent crude, used to price in­ter­na­tional oils, gained 54 cents, or 1 per­cent, to $ 52.96 a bar­rel in Lon­don. Nat­u­ral gas slipped 4 cents to $ 3.19 per 1,000 cu­bic feet, whole­sale gaso­line rose a penny to $ 1.68 per gal­lon and heat­ing oil gained 2 cents to $ 1.56 per gal­lon.

The price of gold fell $ 8.70 to set­tle at $ 1,245 an ounce. Sil­ver slid 5 cents to $ 18.21 per ounce. Cop­per slipped a penny to $ 2.67 per pound.

In cur­rency trad­ing, the dol­lar rose to 111.60 yen from 111.03 yen on Wed­nes­day. The euro fell to $ 1.0691 from $ 1.0760.

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