Stocks Finish Stronger on Fall in Energy Prices
A plunge in oil of more than $1.50 per barrel, coupled with a rise in bond prices, helped push major stock indexes broadly higher across several sectors in a day of light holiday trading.
The Dow Jones Industrial Average finished stronger, as did the Nasdaq and S&P 500 .
Oil prices fell sharply after a slight advance early in the session. Investors brushed off concerns about Iran's reaction to tough United Nations sanctions designed to curtail the country's nuclear program. A barrel of light sweet crude fell to less than $61 a barrel in trading on the New York Mercantile Exchange.
With little in the way of corporate or economic news to influence trading, Wall Street focused on other markets, so the uptick in bonds lent support to stocks. The 10-year bond was little changed, with its yield at 4.60%; longer-term Treasurys saw more substantial gains.
Wednesday, investors will have new home sales data to digest.
Retailers also influenced major stock indexes. An early projection of holiday spending between Thanksgiving and Christmas showed a disappointing 6.6% rise over last year, according to MasterCard. Sales during the same period last year climbed 8.7%.
Trading volume is expected to remain light this week as many investors are on vacation, which tends to skew price moves and make them appear more dramatic than they perhaps are.
"We're seeing lower oil prices being a minor catalyst for the market," said Joe Ranieri, managing director of equity trading for Canaccord Adams. "Other than that, you're just seeing a quiet week with added volatility."
Exxon Mobil was among the Dow leaders. Crude oil prices were higher earlier in the session, though they later turned lower on concerns about warm weather. Oil contracts initially rose on reports that Iran has vowed to continue its nuclear research program and threatened to use oil exports as a weapon in defiance of United Nations sanctions.
Gains in gold stocks also helped to support the major averages.
Shares of Telik sank after the company said its experimental cancer drug, Telcyta, did not significantly improve survival in patients with advanced lung cancer or in patients with resistant ovarian cancer.
FedEx Corporation says European regulators have asked the company for information as part of a probe into possible anti-competitive behavior in the air freight transport industry, according to Reuters.
European stock markets remain closed for extended Christmas holidays, while stock prices in Tokyo hit a seven-month high.