NEW YORK: U.S. crude-oil prices jumped 4.5% on expectations that major producers would reach a deal to freeze production levels at a meeting Sunday, giving investors hope that the pressure on commodity-linked companies could ease after a long rout.
The energy sector was by far the best performer Tuesday in the S&P 500, rising 2.8%, its largest gain since Feb. 17. Chevron led the Dow industrials, rising $2.27, or 2.4%, to $97.51.
“We’re in the process of turning a corner,” said Jim Margard, senior portfolio manager at Rainier Investment Management, which has about $3 billion in assets under management. Mr. Margard said he has been buying shares of energy companies this week.
Crude for May delivery gained $1.81, to $42.17 a barrel on the New York Mercantile Exchange, its highest settlement price since Nov. 25.
The financial sector was the second-best performer in the S&P 500, rising 1.3%. Investors have been concerned about banks’ loans to the energy sector as oil prices have languished near multiyear lows.
The Dow Jones Industrial Average notched its largest one-day point and percentage gain since March 11, rising 164.84 points, or 0.9%, to 17721.25. The S&P 500 rose 19.73 points, or 1%, to 2061.72, while the Nasdaq Composite Index added 38.69 points, or 0.8%, to 4872.09.
All 30 Dow components rose for the first time since Feb. 25 and every sector in the S&P gained.
“That does suggest overall that it’s broader investor optimism than just the rebound in oil,” said Kate Warne, investment strategist at Edward Jones.
Despite the recent stock-market rebound, the S&P 500 has closed in positive territory only 12 times in 69 sessions in 2016, bringing its year-to-date gain to 0.9%.
Companies’ outlooks for the rest of the year will be in focus for many investors during the earnings season. “After a weak first quarter, I don’t expect much surprisingly positive forward guidance,” said Tony Roth, chief investment officer at Wilmington Trust. “We expect to see companies beat on the bottom line, but the top line won’t look good.”
Haven assets such as U.S. government debt and gold are still up this year, as many investors have remained cautious about a rally in stocks and energy prices since mid-February.
Investors “aren’t fully committed to the rally,” said Ernesto Ramos, head of equities at BMO Global Asset Management.
Gold for April delivery gained 0.2%, to settle at $1,259.40 a troy ounce. Treasury prices fell, pushing the yield on the 10-year note to 1.781%, compared with 1.724% Monday, as yields move inversely to prices.
The International Monetary Fund on Tuesday warned that the world economy is increasingly at risk of stalling and again cut its forecast for global growth.
The Stoxx Europe 600 rose 0.5%. Japan’s Nikkei Stock Average gained 1.1%, as the yen weakened against the dollar, boosting shares of exporters.
The dollar rose to ¥108.54, from ¥107.94 on Monday, after the Japanese finance minister warned against excessive yen strength. The Japanese currency had risen against the dollar for seven consecutive sessions.
