NEW YORK: Energy shares climbed as crude-oil prices hit a fresh 2016 high, contributing to a broad rally in U.S. stocks.
Stocks’ swings have picked up in the past week. The Dow Jones Industrial Average rose 175.39 points Monday, its fourth move of at least 1% since last Tuesday. March and April had just four moves of at least 1% between them, while the first two months of the year had 24.
Major U.S. indexes have rebounded from the year’s lows in mid-February, but investors are concerned that weak economic growth and corporate earnings could limit gains. The Dow industrials and S&P 500 fell for a third straight week last week, and are now up 1.6% and 1.1% for 2016, respectively.
Technology shares were among the biggest gainers Monday, paring 2016 losses for one of the few S&P 500 sectors still down for the year. The tech-heavy Nasdaq Composite Index rose 57.78 points, or 1.2%, to 4775.46.
“It’s a nice confluence of events here,” said Brian Jacobsen, chief portfolio strategist at Wells Fargo Funds Management, referring to the gains in energy and tech stocks. “It does highlight that there are plenty of bargain hunters out there.”
Apple rose $3.36, or 3.7%, to $93.88 after Warren Buffett’s Berkshire Hathaway took a new $1 billion stake in the technology giant in the first quarter. Apple shares had fallen about 13% through last week since the company in April reported its first quarterly revenue decline in 13 years.
Nvidia rose 1.21, or 3%, to 42.19, while Activision Blizzard rose 1.10, or 2.9%, to 39.39.
The S&P 500 rose 20.05 points, or 1%, to 2066.66. Energy shares rose the most, gaining 1.6%. Williams Companies added 1.24, or 6.4%, to 20.59.
U.S. crude oil rose 3.3% to $47.72 a barrel, its highest settlement since Nov. 3.
Analysts at Goldman Sachs said the oil market is now facing a shortfall after recent outages from large producers such as Canada and Nigeria. While global oil production has exceeded demand for almost two years and inventories of crude stand near record highs, supply has tightened in recent weeks.
Goldman, which has been one of the most bearish banks on oil recently, now expects crude prices to climb to $50 a barrel in the second half of 2016, up from its April 22 forecast of prices between $40 and $45.
The yield on the 10-year Treasury note rose to 1.752% from 1.705% on Friday for its biggest one-day yield gain since April 20.
Some investors said that after a big stock-market rally from February’s lows, better earnings were the key to further gains.
“The next leg up has to be better news, and that’s going to take some time to show up,” said Bob Doll, senior portfolio manager at Nuveen Asset Management.