NEW YORK: U.S. stocks rallied into the close and ended Thursday’s session with solid broad-based gains.
Analysts pointed to a rebound in oil prices as the driving force behind the resurgence, as stocks have been closely tracking crude-oil futures, lately.
WTI oil futures fell sharply earlier, but have since rebounded to settle at about $44 a barrel.
The S&P 500 SPX, +0.95% closed up 19.10 points, or 1%, at 2,021.26, with all 10 main sectors finishing higher.
The Dow Jones Industrial Average DJIA, +1.31% jumped 225.48 points, or 1.3%, to 17,416.85, as big gains in McDonald’s Corp and Boeing Co helped lift the index.
The tech-heavy Nasdaq Composite COMP, +0.98% ended the day up 45.41 points, or 1%, at 4,683.41.
Ahead of the opening bell, market reaction to a stronger-than-expected jobless claims figure was mostly muted, with stocks dipping into the red in early trade.
“The biggest contributor to intraday volatility on Wall Street has been oil. We saw big swings in the stock market whenever oil prices moved sharply in either direction,” said Randy Frederick, managing director at the Schwab Center for Financial Research.
Trading on Wall Street so far this year has been nearly twice as volatile as 2014, as evidenced by the average daily price change in the S&P 500 in both directions — of almost 20 points.
“Volatility doesn’t always mean losses, and can spell opportunity for traders, as more sizable moves in either direction remain possible this week,” added Frederick.
Ed Cowart, managing director and portfolio manager at Eagle Asset Management, hypothesized that oil, which has dipped by 60% since its 2014 peak in June, is near its bottom.
“We are now seeing a very steep contango — when investors buy physical oil and store it, selling it at a higher price for future delivery. Usually it’s a sign that oil prices bottomed,” Cowart said.
