By Saumya Vaishampayan
U.S. stocks opened mixed Friday after the Organization of the
Petroleum Exporting Countries decided to maintain its oil
production target.
Shares of transportation companies that benefit from lower oil
prices rose, while shares of companies tied to the oil industry
fell.
The Dow Jones Industrial Average rose 31 points, or 0.2%, to
17858. The S&P 500 index declined three points, or 0.1%, to
2070, while the Nasdaq Composite Index advanced eight points, or
0.2%, to 4796.
The U.S. stock market was closed Thursday for Thanksgiving. On
Friday, it will close earlier than usual at 1 p.m. Eastern
time.
The OPEC cartel on Thursday decided to stick to its current
target of producing 30 million barrels of oil a day, rejecting
calls to cut output amid a steep slump in oil prices. The decision
was accompanied by a commitment from OPEC members to comply with
it. That implies a cut of around 300,000 barrels a day, based on
OPEC's figures, since the 12-member cartel currently pumps more
than its production ceiling. But that's a relatively small change
in global oil supply.
Brent, the global oil benchmark, rose 1% to $73.32 a barrel. It
fell 6.7% on Thursday after the OPEC meeting.
On the New York Mercantile Exchange, crude-oil futures dropped
5.8% to $69.42 a barrel. The Nymex floor was closed Thursday in
observance of the Thanksgiving holiday, though electronic trading
took place.
U.S. stocks have more than recovered from a pullback in
September and October that was sparked in part by the drop in oil
prices and concerns about the pace of global growth. The Dow closed
at its 30th record on Wednesday, while the S&P notched its 47th
closing high. Gains in recent weeks have been fueled by improving
U.S. economic data and the third-quarter earnings season, which was
broadly upbeat.
Many investors say falling oil prices will benefit U.S.
consumers, who will begin spending more and help boost the U.S.
economy.
"Overall, it is a net positive for the U.S., [because] we are a
consumer-led economy," said Quincy Krosby, market strategist for
Prudential Financial, referring to the OPEC decision.
Declines in energy stocks weighed on the S&P 500, with the
sector down 5.6%. Chevron Corp. shares slumped 5.3% and those of
Exxon Mobil Corp. lost 3.3%, leading declines on the Dow
industrials.
The OPEC decision and lower oil prices could lead to more deal
activity in the energy sector, said Ms. Krosby of Prudential
Financial.
Shares of Southwest Airlines Co. and Delta Air Lines Inc., which
stand to benefit from lower oil prices, rose the most on the
S&P 500.
Russia's ruble, which this year has been pummeled by
geopolitical tensions and resulting sanctions, hit yet another
all-time low against the dollar, while fellow oil-linked currencies
such as the Canadian dollar, Norway's krone and Nigeria's naira
slipped too.
"OPEC yesterday delivered just about the most unfriendly
possible response to [the] ruble and oil prices," said Tom
Levinson, a strategist at Sberbank. He added that it was unclear
whether Russia's central bank would intervene to curb the
currency's slide.
European stock indexes were broadly lower, with the Stoxx Europe
600 down 0.3%. Data released Friday showed the eurozone's annual
rate of inflation in November fell further below the European
Central Bank's target of just under 2%.
In other commodity markets, gold futures fell 1.5% to $1179.20
an ounce.
Demand for government debt increased, sending the yield on the
10-year Treasury note down to 2.214%. Yields fall as prices
rise.
Josie Cox and Chiara Albanese contributed to this article.
Write to Saumya Vaishampayan at saumya.vaishampayan@wsj.com
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