Rally in health-care stocks helped propel them to gains
U.S. stocks closed higher on Wednesday, 07 October 2015 as a rally in health-care stocks helped propel them to gains during an up-and-down trading session.
The Dow Jones Industrial Average added 122.10 points, or 0.7%, to close at 16,912.29, posting gains for the fourth straight session. The Nasdaq Composite rose 42.79 points, or 0.9%, to finish at 4,791.15, driven by a rally in biotechs. Meanwhile, the S&P 500 gained 15.91 points, or 0.8%, to end at 1,995.83.
Overall, the midweek session was very quiet, but there was some volatility present in the market as stocks surrendered their opening gains going into the afternoon, but returned into the middle of their ranges by the closing bell.
Commodity-sensitive energy and materials sectors paced the opening move higher, but both sectors surrendered a portion of their gains as the session wore on. The energy sector was up nearly 2.5% at the start, but retreated from its high as crude oil erased its intraday gain.
The largest sector by weighttechnology underperformed throughout the day, but was able to climb off its low into the close. Large sector components like Apple, Alphabet and Oracle lost between 0.2% and 0.6% while high-beta chipmakers outperformed.
Also of note, the consumer discretionary sector struggled in the early going, but ended the day in the green despite an 18.8% plunge in the shares of Yum! Brands after the company reported disappointing results and guided below analyst expectations.
Bullion prices ended a choppy, two-sided trading session modestly higher on Wednesday, 07 October 2015 at Comex. Prices notched another two-week high as bulls are building upon their recent momentum. Also, a general rebound in the raw commodity sector this weekled by crude oilis benefiting the precious metals bulls. Gold futures for December delivery rose $2.30, or 0.2%, to settle at $1,148.70 an ounce on Comex after earlier tapping highs above $1,150. December silver meanwhile, added 11 cents, or 0.7%, to end at $16.094 an ounce, and has picked up more than 5%, so far this week.
Oil futures logged its first loss in four sessions on Wednesday, 07 October 2015 after a U.S. government report revealed an increase in weekly crude inventories along with a climb in domestic production. Oil prices have been supported this week by reports that Russia, one of the top crude producers in the world, has expressed willingness to meet with nonmembers and OPEC members to discuss market conditions.
On the New York Mercantile Exchange, November West Texas Intermediate crude lost 72 cents, or 1.5%, to settle at $47.81 a barrel, after spending the session switching between gains and losses. Prices had tallied a more than 8% in the last three sessions.
The U.S. Energy Information Administration reported on Wednesday an increase of 3.1 million barrels in crude supplies for the week ended 2 Octobeer 2015. Market had expected supplies to be up by 1.75 million barrels. The EIA's reported increase comes on the heels of a fall in oil-refinery activity, which tends to lower demand for crude. The data also showed that total domestic production reached 9.17 million barrels a day, up 76,000 barrels from a week earlier. Output for the lower 48 states was at nearly 8.69 million barrels a day, up 58,000 barrels.
Prices had found support after the disappointing U.S. monthly jobs report released Friday, which fueled expectations that the Federal Reserve may further delay an interest-rate hike. That has helped to push the U.S. Dollar Index lower by about 0.4% this week so far, and a weaker greenback tends to make dollar-denominated assets more appealing.
Economic data on Wednesday included Consumer Credit and MBA Mortgage Index. The consumer credit report for August showed an increase of $16.00 billion, which was lower than the consensus estimate of $19.50 billion. The prior month's credit growth was revised down to $18.90 billion from $19.10 billion. Separately, the weekly MBA Mortgage Index surged 25.5% to follow last week's 6.7% decline.
Unlike stocks, Treasuries spent the day in negative territory, ending the day with modest losses. Accordingly, the benchmark 10-yr yield rose three basis points to 2.07%.
Today's participation was well above average with more than 1.15 billion shares changing hands at the NYSE floor.
Tomorrow, weekly Initial Claims will be reported at 8:30 ET (consensus 275,000) while the September FOMC Minutes will be released at 14:00 ET.
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