TOCKS closed higher yesterday, fueled by gains in oil companies and speculation that upcoming first-quarter earnings reports might not be quite as weak as previously thought.
All 10 major S&P 500 sectors gained, with the energy index leading, up 2.3 per cent. US crude jumped more than five per cent after a lower-than-expected build of US crude stockpiles.
Intel jumped 4.25 per cent to $32.83 after the chipmaker said late yesterday it expects flat revenue for the entire year despite some weakness in the first quarter.
Investors have feared the March-quarter earnings season, just getting under way, would be crippled by low oil prices, a strong dollar and extreme weather in the eastern United States. First-quarter profits for S&P 500 companies are seen dropping 2.6 per cent, according to Thomson Reuters.
Of the 36 companies in the S&P 500 that have reported so far, 81 per cent beat expectations, better than the 63 per cent of companies exceeding expectations in a typical quarter. But just 47 per cent of companies exceeded revenue expectations, worse than 61 per cent seen in a typical quarter. That suggests companies are bolstering their bottom lines by cutting costs.
The Dow Jones industrial average rose 75.91 points, or 0.42 per cent, to close at 18,112.61. The S&P 500 gained 10.79 points, or 0.51 per cent, to 2,106.63 and the Nasdaq Composite added 33.73 points, or 0.68 per cent, to end the day at 5,011.02.