Stocks climb again as energy companies keep rising
Stocks made modest gains Thursday as the market once again turned higher late in the day. Energy stocks led the way as investors continued to hope that oil prices have stabilized after almost two years of steep declines.
For the second day in a row, stocks opened with small losses and gradually rose during the afternoon. Energy companies surged and are now slightly higher for the year. Industrial companies such as Caterpillar and Deere also rose. Drugmakers led a decline in healthcare stocks.
The Dow Jones industrial average rose 44.58 points, or 0.3%, to 16,943.90. The Standard & Poor’s 500 index climbed 6.95 points, or 0.4%, to 1,993.40. Tech stocks lagged, and the Nasdaq composite index edged up 4 points, or 0.1%, to 4,707.42.
Stocks surged Tuesday and have eked out small gains over the past two days, aided by steady oil prices and reports showing the U.S. economy is on solid footing. The market is on target for its third consecutive weekly gain.
The price of U.S. crude wavered between small gains and losses, finally closing down 9 cents at $34.57 a barrel in New York. Brent crude, the benchmark for international oils, rose 14 cents to $37.07 a barrel in London. The price of U.S. oil has risen more than 30% in three weeks, and Brent crude has erased its losses for the year.
ConocoPhillips shares rose 5.7% to $38.56 and Southwestern Energy jumped 18.2% to $7.34.
Chesapeake Energy continued to skyrocket after the company said it does not expect to be prosecuted or fined as part of a federal investigation into founder and former company head Aubrey McClendon, who left the company in 2013.
On Tuesday, McClendon was indicted by a federal grand jury on charges of rigging gas-lease bids. He died in a single-car crash in Oklahoma City less than a day later.
Chesapeake shares, which jumped 23% on Wednesday, added 25.6% on Thursday. They had tumbled 74% in 2015.
J.J. Kinahan, chief market strategist for TD Ameritrade, said that after Tuesday’s surge, investors are being patient and looking for good news about the state of the economy. That could come Friday morning, when the government reports employment figures.
Kinahan said investors will be looking for signs of growth in better-paying jobs, possibly in the manufacturing or healthcare industries.
“We know we’re not going to be a manufacturing economy again,” he said, but investors still hope to see some growth in manufacturing jobs.
The Commerce Department said Thursday that orders to U.S. factories grew 1.6% in January, the biggest gain in seven months. A category that measures business investment rose by the largest amount in 19 months.
Mining equipment maker Joy Global climbed 20.8% to $16.09 after it said first-quarter sales were stronger than expected. 3-D printer maker Stratasys rose 17.4% to $24.53; the company’s fourth-quarter results were better than expected, and it gave a strong forecast for 2016.
Supermarket operator Kroger dropped 7% to $37.80 after investors were disappointed with its quarterly sales and its forecasts.
Losses for biotech drug companies pulled healthcare stocks lower. Cancer drugmaker Celgene fell 1.9% to $102.73, and hepatitis C drugmaker Gilead Sciences, based in Foster City, Calif., fell 1.1% to $87.83. Alexion Pharmaceuticals sank 3.8% to $145.85.
The prices of gold, silver and copper each rose about 1%. Gold rose $16.40 to $1,258.20 an ounce. Silver closed up 12 cents at $15.15 an ounce. Copper advanced 3 cents to $2.21 a pound. The price of gold has climbed almost 19% this year, and silver has risen about 10%.
Britain’s FTSE 100 and Germany’s DAX each fell 0.3%. France’s CAC 40 declined 0.2%. Asian markets closed mostly higher. Japan’s Nikkei 225 rose 1.3% and South Korea’s Kospi gained 0.6%. Hong Kong’s Hang Seng index fell 0.3%.
Chinese leaders are expected to lower their growth target during the gathering of the National People’s Congress this week as China seeks more flexibility for structural reforms for the slowing, state-dominated economy. The growth target, to be announced Saturday, is expected to be a range of 6.5% to 7%, down from 2015’s goal of about 7%.
In other energy trading, wholesale gasoline slipped 1 cent to $1.30 a gallon. Heating oil rose 1 cent to $1.12 a gallon. Natural gas, which is trading at 17-year lows, fell 4 cents to $1.64 per 1,000 cubic feet.
Bond prices edged higher. The yield on the 10-year Treasury note slipped to 1.83% from 1.84% late Wednesday. The euro rose to $1.0950 from $1.0868 and the dollar edged up to 113.52 yen from 113.45 yen.
