Wall Street gets boost from crude oil recovery

By Abhiram Nandakumar

(Reuters) - Wall Street was higher on Wednesday afternoon as a strong recovery in oil prices pushed energy shares higher.

Brent crude extended gains above $40 a barrel, after U.S. crude stockpiles rose in line with estimates last week and gasoline inventories fell more than expected.

Crude oil has rallied in recent weeks, but industry watchers remained skeptical of a sustained recovery in prices as the markets are dealing with a massive oversupply.

The rise in oil prices helped European shares bounce back on Wednesday, even as investors fretted about global economic conditions ahead of central bank meetings on monetary policies.

 

"It's the same three culprits that have been driving the first two months of the year and that is - central bank policy, China and oil," said Bill Northey, chief investment officer of the private client group at U.S. Bank. in Helena, Montana.

At 14:24 p.m. ET (1924 GMT), the Dow Jones industrial average <.DJI> was up 32.12 points, or 0.19 percent, at 16,996.22, the S&P 500 <.SPX> was up 8.37 points, or 0.42 percent, at 1,987.63 and the Nasdaq Composite index <.IXIC> was up 22.44 points, or 0.48 percent, at 4,671.26.

Eight of the 10 major S&P sectors were higher, led by a 1.69 percent rise in energy shares <.SPNY>. Chevron was up 4.8 percent at $93 and gave the biggest boost to the sector.

The European Central Bank is widely expected to increase its stimulus program at its meeting on Thursday.

While the U.S. Federal Reserve is not expected to raise interest rates at its meeting on March 15-16, the central bank has said it is on track to raise rates gradually this year.

Biotechs came under pressure after the U.S. government proposed a test program aimed at lowering Medicare drug costs. The Nasdaq Biotechnology sector <.NBI> was down 1.3 percent.

Amgen's 2.3 percent decline was the biggest drag on the Nasdaq and the S&P 500. Regeneron was down 4.8 percent and Celgene fell 1.7 percent.

Chipotle Mexican Grill was down 2.9 percent at $509.01. The company, already reeling from several food-borne illnesses, temporarily shut a Massachusetts restaurant after four employees fell sick.

Advancing issues outnumbered decliners on the NYSE by 2,117 to 838. On the Nasdaq, 1,712 issues rose and 1,025 fell.

The S&P 500 index showed 27 new 52-week highs and one new low, while the Nasdaq recorded 41 new highs and 36 lows.

(Reporting by Abhiram Nandakumar in Bengaluru; Editing by Anil D'Silva)