A spurt of buying in the late afternoon contributed to the majority of Wall Street’s stock indices closing higher on Monday (US time), bringing in a five-day losing streak for the S&P 500.
The benchmark index shook off the afternoon slump and closed 0.2 percent higher. Banks, energy companies and communications stocks made up a large part of the index’s broad gains. Health and utility stocks fell. The S&P 500 saw its largest weekly decline since June.
Despite the rally, the ASX will open lower, with futures pointing to a 12 point drop, or 0.2 percent, on the open at 6:37 a.m. AEST.
Oil prices have firmed as hurricane season dampens US production and producers look out for increased demand after the pandemic. Credit:AP
The price of US crude oil rose 1 percent and went back over $ 70 ($ 95) a barrel. It has not closed above this level since the beginning of August. Natural gas prices rose 5.9 percent to their highest level since mid-2014. The solid gains helped fuel energy stocks, including a 2.6 percent increase for Exxon Mobil and a 7.2 percent increase for Marathon Oil.
Stocks have been trading in a tight range for several weeks as most investors sit on the sidelines waiting to get a fuller understanding of where the economy is going and how the pandemic is affecting companies.
“Interestingly, everything is still within the narrow range we’ve seen in the markets,” said Greg Bassuk, CEO of Axs Investments. “Investors are still looking for bigger or bigger news related to the economic recovery.”
The S&P 500 rose 10.15 points to 4,468.73. Despite its pullback last week and a slight rise on Monday, the index remains just 1.5 percent below its all-time high of September 2nd.
The Dow Jones Industrial Average rose 261.91 points, or 0.8 percent, to 34,869.63, while the Nasdaq fell 9.91 points, or 0.1 percent, to 15,105.58.
Bond yields have fallen slightly. The yield on 10-year government bonds fell from 1.34 percent late Friday to 1.32 percent.
Wall Street will have several key dates to review this week. The Department of Labor is due to release its August Consumer Price Index on Tuesday, giving investors another update on inflation as businesses and consumers face higher prices due to supply restrictions.
The Department of Commerce will release August retail sales data Thursday to a market that is still trying to determine the full impact of rising COVID-19 cases on consumer spending.