Energy, financials and technology sectors lead the gains
U.S. stocks rose for the first time in three sessions on Tuesday, 28 June 2016 recovering some of their brutal losses seen in the aftermath of the U.K.'s vote to quit the European Union. The gains come after a brutal, two-day rout in global equities that resulted in months of gains washed away following Britain's referendum to leave the EU, known as Brexit. Rattled investors feared that Brexit would destabilize the European trading bloc.
The Dow Jones Industrial Average, which over the past two sessions lost 900 points, jumped 269.48 points, or 1.6%, to 17,409.72. The Nasdaq Composite Index added 97.42 points, or 2.1%, to 4,691.87. The broader S&P 500 index added 35.55 points, or 1.8% to 2,036.09, with all 10 main sectors finishing higher. Energy, financials and technology sectors lead the gains, rising more than 2%.
However, investors appeared to turn cautiously optimistic on Tuesday.
Market reaction to economic reports was largely muted. The U.S. economy's annual growth rate in the first quarter was raised again to 1.1% in line with expectations. However, the pace of growth was still one of the weakest performances in the past several years.
Separately, U.S. house prices rose 1.1% in April, according to a closely watched price gauge released Tuesday. Meanwhile, U.S. consumer confidence took a step higher in June although the survey was taken before Britain's vote to leave the European Union.
Meanwhile, bank shares rose sharply. Citigroup shares jumped 5.1% and JPMorgan Chase & Co climbed 3.3%.
Asia markets also rebounded after getting slammed in the wake of last week's Brexit vote.
Oil futures finished higher for the first time in three sessions on Tuesday, 28 June 2016 at Nymex rebounding from a Brexit-fueled selloff that sent crude futures to a seven-week low on concerns of a slowdown in the global economy. The threat of a union strike by Norwegian oil-and-gas workers and weakness in the U.S. dollar also provided support to prices.
August West Texas Intermediate crude climbed $1.52, or 3.3%, to settle at $47.85 a barrel on the New York Mercantile Exchange, while August Brent crude gained $1.42, or 3%, to $48.58 a barrel.
Oil supply issues also factored into Tuesday trading as up to 7,500 oil-and-gas workers in Norway, which is one of Europe's major producers, may be affected by a strike starting Saturday. The workers are demanding a new wage deal before midnight 1 July.
The Energy Information Administration will release its weekly report early Wednesday. Market expects to see a fall of 2.4 million barrels in crude-oil inventories, along with declines of 600,000 for gasoline supplies and 1 million barrels for distillates, which include heating oil.
Bullion prices ended in a mixed mode on Tuesday, 28 June 2016 at Comex. In precious metals, gold witnessed an afternoon of consolidation, snapping its 2-session streak of gains to close lower.
August gold ended Tuesday's session down $6.80 (-0.5%) to $1317.80/oz. Silver traded sideways in afternoon trade, inching higher into the close as the dollar weakened. July silver closed the session $0.08 higher (+0.5%) at $17.83/oz.
The Treasury complex finished modestly lower as the yield on the 10-yr note rose two basis points to 1.46%.
Today's participation was above the recent average as more than one billion shares changed hands on the NYSE floor.
Tomorrow's economic data will include the 7:00 ET release of the weekly MBA Mortgage Index. Meanwhile, Personal Income (consensus 0.3%), Personal Spending (consensus 0.3%), and Core PCE Prices (consensus 0.2%) for May will cross the wires at 8:30 ET. Finally, the day's data will be capped off with Pending Home Sales for May (consensus -1.4%), which will be released at 10:00 ET.
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