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US: Stocks rally continues as oil rises
[NEW YORK] Wall Street stocks scored strong gains for the second day in a row Wednesday as investors took a positive view of increasing oil prices and potentially higher US interest rates.
Energy shares were among the big winners as US oil prices closed at their highest price of the year, just shy of US$50 a barrel. Banking shares were also strong on the prospect that the Federal Reserve could soon hike interest rates.
"The market is embracing the idea that if the Fed moves in June or July, the bull market can continue, so we have an economy that is growing at a modest pace," said Alan Skrainka, chief investment officer at Cornerstone Wealth Management.
The Dow Jones Industrial Average advanced 0.8 per cent to 17,851.51.
The broad-based S&P 500 rose 0.7 per cent to 2,090.54, while the tech-rich Nasdaq Composite Index gained 0.7 per cent to 4,894.89.
Citigroup shares added 2.4 per cent even as US regulators announced US$425 million in fines over charges it attempted to manipulate Libor and other leading financial benchmarks.
Oil giants ExxonMobil and Chevron rose 0.7 per cent and 1.6 per cent respectively as they turned back shareholder efforts to force them to take more action on climate change.
Midsized petroleum companies Marathon Oil and Anadarko Petroleum climbed nearly four percent on higher oil prices.
Technology shares were also generally higher, with Apple gaining 1.8 per cent, Microsoft 1.0 per cent and Netflix 2.4 per cent.
Hewlett Packard Enterprises jumped 6.8 per cent after announcing it will spin off and merge its corporate services business into Computer Sciences Corp in a deal valued at US$8.5 billion. Computer Sciences soared 42.1 per cent as it said the merger would create one of the world's largest information technology services companies, with more than 5,000 clients in 70 countries.
Chinese online giant Alibaba slumped 6.8 per cent after disclosing that US securities regulators were probing its accounting for possible violations of US securities laws. Yahoo, which holds a large stake in Alibaba, lost 5.2 per cent.