The Morning Journal (Lorain, OH)
U.S. stocks rise as energy companies rally
Energy companies jumped with the price of oil, but overall, stocks finished only slightly higher.
NEW YORK >> Energy companies jumped with the price of oil Wednesday, but overall, stocks finished only slightly higher as a quiet week of trading continued.
The price of U.S. crude oil jumped 3 percent as fuel stockpiles kept shrinking, and that made investors more optimistic about energy company profits. Strong earnings from video game maker Electronic Arts and chipmaker Nvidia helped technology stocks move up. However weak results from Priceline and Disney hurt consumer-focused companies, and health care stocks also stumbled as drug companies fell.
Investors didn’t react much to President Donald Trump’s surprise decision to fire FBI Director James Comey on Tuesday evening. U.S. stocks also had little reaction to the French presidential election last weekend, although European indexes climbed following the win by centrist candidate Emmanuel Macron.
“It’s almost as if the market has become numb,” said Julian Emanuel, an equity strategist for UBS. “Investors are interpreting this as more noise.”
Emanuel said investors are focused on economic growth and the Trump administration’s business-friendly agenda. Until they have a clearer understanding of how well the economy is doing and whether Trump’s policies will be implemented, he said investors may just wait and see, in which case stocks will stay in the range they’ve traded in for the last few months.
The Standard & Poor’s 500 index picked up 2.71 points, or 0.1 percent, to 2,399.63, a fraction of a point above the all-time high it set Monday. The Dow Jones industrial average shed 32.67 points, or 0.2 percent, to 20,943.11 as Disney and Boeing slumped. The Nasdaq composite finished at a record for the fourth day in a row as it rose 8.56 points, or 0.1 percent, to 6,129.14. The Russell 2000 index of small-company stocks was up 7.73 points, or 0.6 percent, to 1,399.59.
Oil prices made big gains as reports showed U.S. crude stockpiles dropped by 5.2 million barrels last week. That was bigger than analysts expected. Crude inventories are returning to more normal levels after they swelled to record highs the last few years.
Benchmark U.S. crude surged $1.45, or 3.2 percent, to $47.33 a barrel in New York. Brent crude, the international standard, gained $1.49, or 3.1 percent, to $50.22 a barrel in London
EOG Resources gained $2.90, or 3.2 percent, to $94.54 and Chevron added $1.42, or 1.4 percent, to $106.50.
Crude oil prices have fallen in recent weeks as investors wondered if the members of OPEC and other key oil-producing countries will be able to limit production and support prices. U.S. oil has traded between around $45 and $55 a barrel this year as investors worried about oil prices and profits at energy companies. The S&P 500’s energy sector has dropped 10 percent in 2017.
Nvidia advanced $18.35, or 17.8 percent, to $121.29. Nvidia tripled in value in 2016 and had wobbled early this year. Electronic Arts, which makes games including “The Sims” and “Mass Effect,” rose $12.15, or 12.7 percent, to $108.16.