Wall Street stock indexes rose yesterday as higher oil futures boosted the energy sector and investors placed their bets ahead of the US quarterly corporate earnings season.
However, United States Treasury yields dipped in advance of the government’s $24 billion debt auction later in the day, part of its $56 billion sale of notes and bonds this week.
In commodities, oil prices rose around one per cent, supported by strong demand and uncertainty over the conflict in Syria and another shutdown at Libya’s largest oilfield.
Brent crude futures, the international benchmark for oil prices, were up 57 cents at $55.81 per barrel. US West Texas Intermediate (WTI) crude futures were up 65 cents at $52.89 a barrel.
“Markets are taking some comfort in that,” said Jeffrey Kleintop, Chief Global Investment Strategist at Charles Schwab in Boston.
“When we go below $50 investors worry about global weakness and concerns about the solvency and economies of oil producers like Russia and Saudi Arabia.”
The S&P’s energy sector was the biggest percentage gainer and strongest positive influence out of the benchmark’s 11 major sectors.
The Dow Jones Industrial Average rose 70.65 points, or 0.34 per cent, to 20,726.75, the S&P 500 gained 6.67 points, or 0.28 per cent, to 2,362.21 and the Nasdaq Composite added 14.71 points, or 0.25 per cent, to 5,892.52.
Investors will also have their eye on the US earnings season, which kicks off this week with reports from some of the biggest banks.
“There’s some optimism among investors that the earnings reports are going to validate the rise in valuations we’ve seen over the last six months,” said Mr Kleintop.
“The news on earnings will be good but I don’t know that it’ll be good enough to sustain all the gains we’ve seen over the last six months.”
In the currency market the dollar index, which tracks the greenback against six major currencies, was down slightly after touching its highest point in three weeks earlier in the day. The dollar had risen 0.5 per cent Friday.
Benchmark 10-year Treasury yields were 2.364 per cent, down one basis point from late on Friday, while the 30-year yield was 1 basis point lower at 2.988 per cent.
The MSCI all world stock index was up 0.1 per cent.
The index has risen as much as 12.4 per cent since early November to an intraday peak on March 21. It trades at 16 times forward earnings, compared to a 15-year average of about 14 times.
European stocks clung to a tiny 0.01 per cent gain as investors there focused on geopolitical risks.
Top aides to Donald Trump differed on where US policy on Syria was headed after last week’s attack on a Syrian air base, while US Secretary of State Rex Tillerson warned the strikes were a warning to other nations.