By ,
Published January 14, 2015
Stocks rose sharply Monday after upbeat outlooks from Wal-Mart and Lowe's prompted new bargain-hunting and as news that the Venezuelan president survived a recall sent crude prices down.
The Dow Jones industrial average (search) gained 129.20 points, or 1.31 percent, at 9,954.55. The Standard & Poor's 500 Index (search) rose 14.54 points, or 1.37 percent, at 1,079.34. The technology-laced Nasdaq Composite Index (search) advanced 25.62 points, or 1.46 percent, at 1,782.84.
Crude was the biggest influence on stocks, after it pulled back from an all-time high of $46.91 a barrel on the New York Mercantile Exchange (search) as news that Venezuelan President Hugo Chavez (search) survived a recall vote eased some fears that unrest may upset oil exports from the world's fifth-largest crude exporter.
"Oil is certainly helping," said Michael Metz, chief investment strategist at Oppenheimer & Co.
"The fear was that it wouldn't stop until it reached $50 a barrel, but it looks as though at least short term it has stopped. That in itself is encouraging."
September crude settled down 53 cents at $46.05 a barrel after Chavez won the country's recall referendum.
The steady rise in oil prices has put pressure on the market in recent weeks as it pushes through new record highs. The easing prices fueled a broad-based rally, with all three indexes staging a rebound from fresh year-lows hit last week. The S&P recorded its biggest one-day percentage gain in two months.
"Everything is priced into oil being as high as it is," said Todd Leone, managing director of equity trading at SG Cowen Securities. "You see oil go down, stocks will go up. Plus, this market is really cheap right now, so it's going to be pretty attractive for buyers."
The market shrugged off a disappointing drop in the Empire State Manufacturing Index (search), a measure of industrial activity in the New York area. According to the Federal Reserve Bank of New York, the index came in at 12.6 in August, the lowest reading since May 2003, and down from 35.6 in July. Any reading above zero means expansion in manufacturing has occurred.
Lowe's Cos. Inc. (LOW), the No. 2 home improvement retailer behind Home Depot Inc. (HD), rose $2.49 to $49.14; although its earnings missed Wall Street estimates by 2 cents a share, largely because bad weather dented sales in June, it reported a 17.9 percent increase in net income and raised its outlook for the current quarter.
Kmart Holding Corp. (KMRT), the No. 3 U.S. discount retailer, surged 17 percent, or $11.15, to $76.05 after the company posted its third consecutive quarterly profit after emerging from bankruptcy last year. Sales continued to fall, however.
Dow component Wal-Mart Stores Inc. (WMT) was up 65 cents at $54.05 after reporting in a weekly update that sales for August were in line with expectations so far, partly due to brisk business in the southeast as customers prepared for hurricane season.
Allstate Corp. (ALL), the No. 2 U.S. home and auto insurer, rebounded from Friday's fall with a 62 cent increase to $46.55. The group said potential losses stemming from Hurricane Charley (search) could hurt its current results, although it did not expect losses to have a material effect on its financial condition overall.
But Florida insurer 21st Century Holding Co. (TCHC) slid 7.3 percent, or $1.45, to $18.30. It said it will record a $1.25 per share charge against third-quarter earnings due to claims from Charley losses.
Shares of Gateway Inc. (GTW) climbed 33 cents to $4.11 after the struggling computer company announced that CompUSA Inc. would begin selling its desktop products later this week. The decision follows the closure of its 188 retail stores in April.
Advancing shares outnumbered decliners by more than 4 to 1 on the New York Stock Exchange. Volume came to 349.75 million shares, compared to 342.91 million traded at the same point Friday.
Trading was moderate, with 1.2 billion shares changing hands on the New York Stock Exchange, below the 1.4 billion daily average for last year. About 1.3 billion shares were traded on Nasdaq, below the 1.69 billion daily average last year.
Advancers outnumbered decliners on the NYSE by nearly four to one, and about two to one on Nasdaq.
The Russell 2000 index of smaller companies was up 10.67, or 2.1 percent, at 528.06.
Overseas, Japan's Nikkei stock average dropped 0.65 percent. In Europe, Britain's FTSE 100 closed up 1.1 percent, France's CAC-40 climbed 0.9 percent for the session and Germany's DAX index jumped 1.4 percent.
Reuters and the Associated Press contributed to this report.
https://www.foxnews.com/story/stocks-soar-as-oil-prices-drop