On Friday, US stocks climbed while assets have cooled down. This comes as oil prices have increased, which has helped encouraged investors to take a risk. However, it doesn’t look like the gains will be good enough to lift major indexes out of the red.
Stocks steadily climbed in mid-February, and every week for more than four weeks, they were posting at least one-percent gains. Throughout the last few weeks, the markets haven’t been that even, as major indexes being on track to post another week of declines in three weeks. The sustainability of the rally has been questioned by a few analysts because of this.
A portfolio manager at Morgan Stanley Investment Management said that the market roaring back due to the recession was a story that has not been validated, in some ways. The manager did say that as of now, they are at a juncture. He added that there has to be signs of earnings growth in order for stocks to increase, and this boost could be from companies that report better than expected guidance.
As for the Dow Jones Industrial Average, on Friday it rose 47 points. Furthermore, the S&P 500 added more than 0.2%, while the Nasdaq Composite almost broke even. Both the S&P 500 and the Dow Industrial are on track to post a 1% weekly loss.
US traded oil also increased on Friday, as it jumped to $39.61 or 6.3%. Energy companies that are in the S&P saw an increase too, and they experienced the best performing sector in all of the index. This is due to the 2% rise.
The head equity trader at Williams Capital Group said that when it comes to oil and energy companies, they seem to move in sync with one another. He added the market has been trading on the fact that the oil has come off its lows. Asides from that, the consumer discretionary sector suffered the largest decline on Friday. This was due to retail apparel companies.
When the market closed on Thursday, Gap reported less than flattering news. The company announced that their profit margins would be under pressure in the current quarter, and this was due to poo sales. Gap’s stock ended up dropping 12%.
Stocks in the U.S. did pull back on Thursday. In fact, Dow experienced it’s largest drop since late February. However, some of those losses were recovered on Friday.