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Oil's climb and fewer claims lift US stocks
By Jeff Kearns |
January 5, 2009, Monday
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Print Edition
Print Edition
UNITED States stocks advanced the most since November last Friday after fewer Americans filed for jobless claims and oil's biggest weekly increase in two decades lifted energy companies.
Marathon Oil Corp and Baker Hughes Inc climbed more than 15 percent as crude reached US$46.13, the highest in a month. SanDisk Corp staged the steepest rally among technology firms in the Standard & Poor's 500 Index, adding 21 percent as investors speculated it may be acquired. Government actions to shore up General Motors Corp also boosted US equity markets.
The S&P 500 gained 6.8 percent to 931.8, the most since it rallied 12 percent in the week ended on November 28.
The Dow Jones Industrial Average added 6.1 percent to 9,034.69. The Russell 2000 Index of small companies rose 6.1 percent to 505.82, Bloomberg News reported.
''If we get some let-up in risk aversion, we could easily see double-digit percentage gains in US stocks this year, said William Stone, chief investment strategist at PNC Wealth Management in Philadelphia, which oversees US$56 billion. ''We only know two things. Typically, the market moves before the economy does, and valuations are reasonable.''
More than US$30 trillion was erased from global equity markets in 2008. The S&P 500 plunged 38 percent last year, the most since 1937, after the economy entered a recession and the biggest financial firms lost more than US$1 trillion on subprime-related loans and securities.
Energy stocks increased the most among 10 S&P 500 industry groups, jumping 9.6 percent.
Companies that rely on growing consumer spending rose 8.4 percent, the second-biggest gain. Industrial, financial and technology companies advanced more than 7 percent and every group added at least 3.8 percent.
Highest jump
Crude futures jumped 23 percent last week, the most since August 1986, as the conflict in Gaza raised concern Middle East supplies would be cut and Russia curbed natural-gas shipments to Ukraine. Oil fell 54 percent last year, the first annual drop since 2001.
Marathon, the fourth-largest US oil company, advanced US$4.21 to US$28.98. Baker Hughes, the world's third-largest oilfield-services provider, increased US$4.71 to US$34.33. Exxon Mobil Corp, the world's largest oil company, added US$4.45, or 5.8 percent, to US$81.64.
The Labor Department said new jobless claims were depressed by the shortened Christmas workweek even as the total number of people collecting benefits reached a 26-year high. There were 472,000 new claims for the week ended on December 27, below the 575,000 average estimate of economists in a Bloomberg survey.
GM was little changed, erasing a decline of 20 percent. The largest US auto maker got US$4 billion in initial rescue loans from the US Treasury last Wednesday to help it avoid collapse. The shares lost 0.3 percent to US$3.65.
SanDisk, the world's largest maker of memory cards used in digital cameras, rose US$1.90 to US$11.08 on speculation that Toshiba Corp would buy the company. Samsung Electronics Co, Asia's largest maker of chips, scrapped a US$5.85 billion takeover offer for SanDisk on October 22.
The S&P 500 Information Technology Index gained 7 percent to end at the highest level since November 7. All 75 members of the gauge advanced at least 0.9 percent.
Dow Chemical Co plunged 20 percent to US$15.41 for the worst performance among S&P 500 stocks.
The biggest US chemical maker's US$15.4 billion merger with Rohm & Haas Co was threatened by the collapse of a deal between Dow and Kuwait that would have provided funding.
Marathon Oil Corp and Baker Hughes Inc climbed more than 15 percent as crude reached US$46.13, the highest in a month. SanDisk Corp staged the steepest rally among technology firms in the Standard & Poor's 500 Index, adding 21 percent as investors speculated it may be acquired. Government actions to shore up General Motors Corp also boosted US equity markets.
The S&P 500 gained 6.8 percent to 931.8, the most since it rallied 12 percent in the week ended on November 28.
The Dow Jones Industrial Average added 6.1 percent to 9,034.69. The Russell 2000 Index of small companies rose 6.1 percent to 505.82, Bloomberg News reported.
''If we get some let-up in risk aversion, we could easily see double-digit percentage gains in US stocks this year, said William Stone, chief investment strategist at PNC Wealth Management in Philadelphia, which oversees US$56 billion. ''We only know two things. Typically, the market moves before the economy does, and valuations are reasonable.''
More than US$30 trillion was erased from global equity markets in 2008. The S&P 500 plunged 38 percent last year, the most since 1937, after the economy entered a recession and the biggest financial firms lost more than US$1 trillion on subprime-related loans and securities.
Energy stocks increased the most among 10 S&P 500 industry groups, jumping 9.6 percent.
Companies that rely on growing consumer spending rose 8.4 percent, the second-biggest gain. Industrial, financial and technology companies advanced more than 7 percent and every group added at least 3.8 percent.
Highest jump
Crude futures jumped 23 percent last week, the most since August 1986, as the conflict in Gaza raised concern Middle East supplies would be cut and Russia curbed natural-gas shipments to Ukraine. Oil fell 54 percent last year, the first annual drop since 2001.
Marathon, the fourth-largest US oil company, advanced US$4.21 to US$28.98. Baker Hughes, the world's third-largest oilfield-services provider, increased US$4.71 to US$34.33. Exxon Mobil Corp, the world's largest oil company, added US$4.45, or 5.8 percent, to US$81.64.
The Labor Department said new jobless claims were depressed by the shortened Christmas workweek even as the total number of people collecting benefits reached a 26-year high. There were 472,000 new claims for the week ended on December 27, below the 575,000 average estimate of economists in a Bloomberg survey.
GM was little changed, erasing a decline of 20 percent. The largest US auto maker got US$4 billion in initial rescue loans from the US Treasury last Wednesday to help it avoid collapse. The shares lost 0.3 percent to US$3.65.
SanDisk, the world's largest maker of memory cards used in digital cameras, rose US$1.90 to US$11.08 on speculation that Toshiba Corp would buy the company. Samsung Electronics Co, Asia's largest maker of chips, scrapped a US$5.85 billion takeover offer for SanDisk on October 22.
The S&P 500 Information Technology Index gained 7 percent to end at the highest level since November 7. All 75 members of the gauge advanced at least 0.9 percent.
Dow Chemical Co plunged 20 percent to US$15.41 for the worst performance among S&P 500 stocks.
The biggest US chemical maker's US$15.4 billion merger with Rohm & Haas Co was threatened by the collapse of a deal between Dow and Kuwait that would have provided funding.
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