Traders work on the floor of the New York Stock Exchange shortly after the opening bell in New York April 12, 2016. REUTERS/Lucas Jackson
NEW YORK: Gains on Wall Street were driven by a surge in oil on Tuesday, even as Alcoa’s lacklustre results marked a shaky start to the US corporate earnings season.
Crude rose about 2%, with Brent above US$43 per barrel, on hopes that major producers would reach an agreement to curb a persistent global oversupply.
Alcoa shares were down 4.7% at US$9.28.
Investors will focus on corporate earnings over the next several weeks, amid turbulent global markets and the uncertainty surrounding the US Federal Reserve’s plan to raise interest rates.
“It’s really just a pause in front of the full thrust of the earnings season and two weeks in advance of a Fed meeting,” said Bill Northey, chief investment officer of the private client group at US Bank in Helena, Montana.
“So we’re just in a calm before the storm at the moment.” S&P 500 companies are expected to post an average decline in profit of 7.8% for the latest quarter, according to Thomson Reuters I/B/E/S.
The S&P 500 has risen more than 12% from its low in February as oil rebounded and data suggested that the US economy was recovering.
Still, global risks remain a concern. The International Monetary Fund cut its global growth forecast for the fourth time in the past year on Tuesday, citing China’s slowdown, low oil prices and chronic weakness in advanced economies.
At 11:03am ET the Dow Jones industrial average was up 103.86 points, or 0.59%, at 17,660.27, the S&P 500 was up 9.67 points, or 0.47%, at 2,051.66 and the Nasdaq Composite was up 12.99 points, or 0.27%, at 4,846.39.
Nine of the 10 major S&P sectors were higher, led by a 1.57% rise in the energy sector.
Juniper Networks sank 9.2% to US$22.59 after the company estimated quarterly profit and revenue below analysts’ expectations.
Starbucks fell 2.8% to US$59.20 after Deutsche Bank downgraded the stock to “hold” from “buy.”
Advancing issues outnumbered decliners on the NYSE by 2,207 to 656. On the Nasdaq, 1,697 issues rose and 891 fell.
The S&P 500 index showed eight new 52-week highs and four new lows, while the Nasdaq recorded 17 new highs and 14 new lows. - Reuters
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