U.S Stocks Rise Again as Oil Hits 7-Year High
U.S stocks rallied for a fourth day Tuesday as oil prices set a new seven-year high amidst the global energy crunch while housing starts fell more than expected in September 2021.
The Dow Jones Industrial Average rose 0.4% to 35,412.51, with S&P 500 up 0.7% and NASDAQ higher by 0.6%. Healthcare, utilities and energy were the leading sectors, with consumer staples and consumer discretionary the sole decliners after midday.
The 10-year US Treasury yield increased 5 basis points to 1.63%. West Texas Intermediate crude oil climbed 1.4% intraday to $83.60 a barrel, a seven-year high.
“The restrictive production policy pursued by OPEC+ is partly responsible” for the oil price increase, Commerzbank analyst Carsten Fritsch said in a note.
“What is more, OPEC+ is not managing even to bring the agreed supply to the market…OPEC+ supply was around 750,000 barrels per day short in September alone.”
Housing starts fell in September to a 1.56 million seasonally adjusted annual rate, down from August’s revised 1.58 million but up 7.4% from a year earlier, according to the US Census Bureau. Analysts expected 1.62 million, according to Econoday.
“Seasonals played a big role in the increase in August, and they were far less favourable for the September data,” said Jefferies economists Aneta Markowska and Thomas Simons. “This bodes well for a rebound next month, but supply constraints on labour and building materials continue to present challenges for homebuilders.”
Johnson & Johnson (JNJ) reported year-on-year growth in its third-quarter results, with earnings topping analysts’ views while revenue fell short of predictions even as the company lifted its 2021 forecast above Street expectations. Shares gained 2.9% to lead the Dow.
Procter & Gamble (PG) reiterated its full-year outlook but flagged more volatility as commodity and freight costs rise, which weighed on the fiscal first-quarter gross margin even though the consumer product giant’s profit and revenue beat analysts’ estimates. Shares fell 1.5%, the worst performance among Dow blue chips.
Ulta Beauty (ULTA) provided financial targets for fiscal years 2022 through 2024, including low double-digit EPS growth, along with an updated strategic framework aimed at increasing market share and driving profitable growth. Shares slumped 6.4%, the steepest decline in the S&P 500.
ProShares Bitcoin Strategy ETF (BITO) traded 3.1% higher in its New York Stock Exchange debut as the first bitcoin futures-based exchange-traded fund in the US. In the metals markets, gold was up 0.2% to $1,768.30 per troy ounce, silver was up 2.6% to $23.88 an ounce, and copper slipped 0.5% to $4.70 per pound. # U.S Stocks Rise Again as Oil Hits 7-Year High
