USA: Wall Street gets a lift from good European debt news and a healthy bounce in energy shares

Record ID: 186961

  • Title: USA: Wall Street gets a lift from good European debt news and a healthy bounce in energy shares
  • Date: 11th June 2010
  • Summary: NEW YORK CITY, NEW YORK, UNITED STATES (JUNE 10, 2010) (ORIGINALLY 4:3) (REUTERS) (SOUNDBITE) (English) ROBERT BRUSCA, CHIEF ECONOMIST, FACT & OPINION ECONOMICS: "In my view this is just overdue, that the sell-off hasn't made much sense. To me it was traders just extending the trend, riding the trend, I mean people have been looking for arguments as to why they can sell the stock market lower, sell the euro lower, and to me the arguments have really become thinner and thinner, and I think this is just something that has gone far too far. The economies have been looking much better than people have been talking about. They keep talking about threats to growth and meanwhile economic data keep coming in better and better."
  • Embargoed: 26th June 2010 13:00
  • Keywords:
  • Location: Usa
  • Country: USA
  • Topics: Finance
  • Reuters ID: LVA94RYMDE1AHWPP7LRIHGQOCROA
  • Story Text: U.S. stocks posted their best day in the last nine on Thursday (June 10) in response to signs of health in the euro debt market and as investors snapped up energy shares crushed in the previous day's sell-off.
    The energy sector led a broad advance with all but four stocks in the S&P 500 finishing the day higher.
    The S&P energy sector gained 4.9 percent.
    New York-traded shares of BP plc jumped 12.3 percent to $32.78 (USD) a day after posting a near 16 percent decline to a 14-year-low amid concerns over the companies ability to meet mounting costs.
    Baker Hughes Inc shot up 10.6 percent to $42.42 after a JPMorgan upgrade.
    Spain sold 3.9 billion euros of a 3-year benchmark bond seeing strong demand, a positive sign for investors worried about appetite for debt from struggling European nations. The euro rose 1.2 percent against the U.S. dollar, trading above $1.21.
    China confirmed exports jumped nearly 50 percent in May from a year ago, reassuring investors worried about the impact of the European crisis on global growth.
    The Dow Jones industrial average jumped 273.28 points, or 2.76 percent, to 10,172.53. The Standard & Poor's 500 Index rose 31.15 points, or 2.95 percent, to 1,086.84. The Nasdaq Composite Index gained 59.86 points, or 2.77 percent, to 2,218.71.
    Robert Brusca of Fact & Opinion Economics said the market was due for a rebound.
    "In my view this is just overdue, that the sell-off hasn't made much sense. To me it was traders just extending the trend, riding the trend, I mean people have been looking for arguments as to why they can sell the stock market lower, sell the euro lower, and to me the arguments have really become thinner and thinner, and I think this is just something that has gone far too far," said Brusca.
    The S&P 500 posted a bullish technical alert as its daily moving average convergence-divergence, or MACD, a widely followed momentum indicator, generated a "buy" signal. The S&P and the Dow closed above their 14-day moving average, another short-term bullish sign.
    Advancing stocks outnumbered declining ones on the NYSE by a ratio of about 7 to 1, while on the Nasdaq, about 11 stocks rose for every two that fell.
    Further boosting energy shares, crude futures settled up 1.5 percent, or $1.10, at $75.48 a barrel lifted by the Chinese data and after the International Energy Administration raised its estimate for growth in oil demand in 2010.
    Housing stocks soared after U.S. Senate Majority Leader Harry Reid proposed an extension to a part of a homebuyer tax credit.
    Radian Group jumped 10.3 percent to $8.98 and Lennar Corp gained 8 percent to $15.58. the Morgan Stanley housing index rose 4.7 percent.
    About 9.16 billion shares traded on the New York Stock Exchange, the American Stock Exchange and Nasdaq, below last year's estimated daily average of 9.65 billion.
    Before the opening bell, the U.S. government reported that the number of new filings for unemployment benefits fell less than expected last week, while the international trade deficit widened slightly in April, pointing to a moderate economic recovery.
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