By Ellie Ismailidou and Sara Sjolin, MarketWatch
Safety plays, like gold and yen, weaken as risk appetite
grows
U.S. stocks extended gains Friday, as a surge in oil futures
boosted the energy sector while a softening Japanese yen helped
calm investors' nerves after Thursday's selloff.
However, the main indexes were still on track to finish the week
with modest losses of up to 0.8%.
The S&P 500 climbed 15 points, or 0.7%, to 2,057, led by a
2.2% jump in the energy sector that was boosted by oil's surge.
Consumer-discretionary stocks were the only sector in the red, down
0.1%.
The Dow Jones Industrial Average gained 129 points, or 0.7%, to
17,671, led by a 2.2% gain in American Express Co. (AXP) and a 2.1%
rise in Boeing Co.(BA)
Meanwhile, the Nasdaq Composite advanced 34 points, or 0.7%, to
4,881.
Friday's strong gains came after a downbeat day on Thursday
(http://www.marketwatch.com/story/us-stocks-set-to-pause-dollar-crumbles-against-the-yen-2016-04-07),
in which stocks slumped as investors shunned assets perceived as
risky in favor of haven plays, such as the yen and gold.
Heightened volatility should continue to be the norm in the
short term, said Kate Warne, investment strategist at Edward Jones,
as Wall Street is torn between concerns about slower global growth
that are offset by hopes of a production-freeze agreement in the
Organization of the Petroleum Exporting Countries.
Oil prices rebounded strongly
(http://www.marketwatch.com/story/oil-rebounds-but-doha-meeting-remains-a-cloud-on-the-horizon-2016-04-08)
on Friday, boosting the stocks of energy companies like Chevron
Corp. (CVX), up 1.7%, Baker Hughes Inc. (BHI), up 2.8%, and
Marathon Oil Corp. (MRO) , up 4.4%.
At the meeting, planned for April 17 in Doha, Qatar, OPEC and
non-OPEC suppliers are set to discuss a production freeze to
salvage prices. But
Meanwhile, a weakening yen boosted equities on Friday, as the
Japanese currency was at the center of the stock selloff a day
earlier, after it jumped to the highest level against the dollar in
almost 18-months
(http://www.marketwatch.com/story/dollar-slides-to-fresh-18-month-low-vs-yen-as-market-bets-on-no-boj-intervention-2016-04-07)
on Thursday. The yen, typically viewed as a haven asset, gained as
fears that global central banks won't be able to fix the global
economy zapped investor sentiment and spurred a flight to
havens.
But the yen eased back on Friday
(http://www.marketwatch.com/story/dollar-recoups-some-losses-against-yen-after-jawboning-by-japan-2016-04-08)
after Japan's finance minister Taro Aso said he may act against
what he termed "one-sided" yen rises. Stocks bounced back and gold
prices inched lower, another sign that investors were warming up to
taking on more risk.
"Traders still remain on high alert amid fears that even though
Japanese government officials appear to be ruling out immediate
intervention to halt Yen aggressive appreciation, the Bank of Japan
may take action through monetary policy at its meeting on April
28," said Nawaz Ali, currency strategist at Western Union in a
note.
Other analysts expressed concerns about the financial sector,
which got hit particularly hard during Thursday's selloff, amid
worries about the effects of negative interest rates and energy
loan losses on banks' balance sheets. The sector looked set to log
a 2.2% loss for the week and was the worst performer on the S&P
year-to-date, down 7%.
"We can deal with a one-day gut check, but the group's
underperformance has been a bothersome phenomenon for a few weeks
now. With so many areas moving higher in unison for most of the
rally, the SPX's second biggest sector's trouble sticks out like a
sore thumb," said Frank Cappelleri, technical analyst at Instinet,
in emailed comments.
More Fed talk: Federal Reserve Chairwoman Janet Yellen said the
U.S. economy was "on a solid course, not a bubble economy" at a
gathering with former Fed leaders after U.S. markets had closed on
Thursday
(http://www.marketwatch.com/story/yellen-backs-gradual-rate-hikes-at-panel-of-fed-chiefs-2016-04-07).
And New York Fed president said Friday the central bank must
maintain a cautious and gradual approach to raising interest rates
(http://www.bloomberg.com/news/articles/2016-04-08/dudley-calls-for-cautious-and-gradual-fed-tightening-approach),
echoing views about the need for a go-slow approach to rate
increases that Yellen expressed last week.
But U.S. wholesale inventories declined for the fifth straight
month
(http://www.marketwatch.com/story/wholesale-inventories-fall-for-fifth-straight-month-2016-04-08),
offering more evidence that first-quarter growth will be weak.
Other movers and shakers: Under Armour Inc. (UA) underwent a
2-for-1 split Friday, after the athletic apparel company issued
Class C shares to existing shareholders.
Depomed Inc.(DEPO) surged 12% after Starboard Value disclosed
that the company and its affiliates own 9.8% of Depomed's shares
outstanding.
Intercept Pharmaceuticals Inc. (ICPT) tumbled 4.7% after a Food
and Drug Administration advisory committee recommended an
accelerated approval
(http://www.marketwatch.com/story/intercept-shares-rally-on-fda-panel-vote-for-liver-drug-2016-04-07)
of the biotech firm's liver treatment Ocaliva.
Gap Inc. (GPS) tumbled 12% after the retailer late Thursday said
sales fell in March
(http://www.marketwatch.com/story/gap-reports-drop-in-march-sales-high-inventory-2016-04-07).
Shares of Ruby Tuesday Inc. (RT) sank 13% after the restaurant
operator said its losses deepened in the latest quarter
(http://www.marketwatch.com/story/ruby-tuesday-cuts-forecast-as-losses-widen-2016-04-07-174851854),
leading to a sharp cut in its annual profit forecast.
Other markets: European stocks markets rose almost across the
board
(http://www.marketwatch.com/story/european-stocks-rise-on-rebounding-oil-upbeat-german-trade-data-2016-04-08),
getting a boost from the rally in oil prices and
stronger-than-expected German trade data.
Stocks in Asia ended mixed
(http://www.marketwatch.com/story/asian-shares-drop-as-investors-pare-risk-in-wake-of-yens-run-2016-04-08),
as investors digested the latest move in the yen.
(END) Dow Jones Newswires
April 08, 2016 11:16 ET (15:16 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
American Express (NYSE:AXP)
Historical Stock Chart
From Mar 2024 to Apr 2024
American Express (NYSE:AXP)
Historical Stock Chart
From Apr 2023 to Apr 2024
