3/30 U.S. stocks rally; Dow jumps 264 points
Administrator - Monday, 30 March 2015 06:35
U.S. stocks rally; Dow jumps 264 points
NEW YORK (MarketWatch) — U.S. stocks ended Monday’s session with solid gains, as hopes for monetary stimulus form China’s central bank and a flurry of acquisition activity boosted confidence. The main indexes recorded their second-straight session of gains. The S&P 500 SPX, +1.22% closed 25.22 points, or 1.2%, higher at 2,086.24. Energy stocks led the gains, rallying more than 2%. The Dow Jones Industrial Average DJIA, +1.49% jumped 263.65 points, or 1.5% to 17,976.31. The Nasdaq Composite COMP, +1.15% ended the session up 56.22 points, or 1.2%, to 4,947.44.
Gold settles 1.3% lower as dollar, equities climb
Friday’s jobs report is key to this week’s numbers flow
SAN FRANCISCO (MarketWatch) — Gold futures settled lower for a second session on Monday as strength in the dollar and a rally in equities drew investors away from the precious metals market.
Gold for April delivery GCJ5, +0.08% shed $15, or 1.3%, to settle at $1,184.80 an ounce on Comex. May silver SIK5, +0.28% lost 39.5 cents, or 2.3%, to $16.674 an ounce.
“Gold is struggling with rally fade once again with the shine being taken off by prevailing dollar strength,” said Ross Norman, chief executive officer at Sharps Pixley.
Prices for the metal fell on Friday following a seven-session streak of gains. During its climbing streak, gold tallied a total gain of 4.9% thanks to weakness in the stock market and uncertainty overseas.
U.S. equities on Monday rallied amid dovish comments from China’s central-bank chief. The U.S. dollar DXY, +0.00% also strengthened, luring more investors away from the yellow metal.
For now, the gold market is “supported by good buying on price dips, but it is proving insufficient to drive the market beyond overhead chart resistance points — such as $1,198 and the psychologically important $1,200 level,” said Norman. http://www.marketwatch.com/story/gold-loses-ground-again-as-data-anticipation-builds-2015-03-30
Oil could fall below $30 a barrel, but here’s why that’s a good thing
NEW YORK (MarketWatch)—Oil futures could tumble as far as the mid-$20s before bottoming. But if history is a guide, that could be a positive scenario for stocks as corporate earnings and consumers reap the benefit of lower energy prices, said Scott Minerd, global chief investment officer at Guggenheim Partners.
But first, Minerd sees little reason to expect a significant near-term rebound for oil prices.
The supply-demand dynamics remain decidedly unfavorable, he said in a meeting with reporters Monday, particularly with storage capacity at the Cushing, Okla., delivery hub likely to run out in coming weeks. That will put even more crude on the spot market. He also isn’t convinced rig counts have fallen far enough to stop U.S. oil production from rising.
From a technical standpoint, the next stop for oil could be around $34 a barrel, he said, and “could possibly break into something in the mid-$20s.” Nymex West Texas Intermediate futures CLK5, -0.08% closed at $48.68 a barrel on Monday, down 19 cents. Oil traded above $107 a barrel in June 2014 before beginning a steep plunge.
It’s no surprise that the drop has been tough on the energy sector, while broader indexes have at times rallied on the prospect of cheaper energy prices and at other times dropped in lock step with crude.
All in all, oil weakness should be a positive for U.S. equities, Minerd said, drawing a parallel with 1986, when the beneficial effects of a plunge in oil helped stocks rally even as the Federal Reserve raised interest rates.
That year, Nymex crude oil prices plunged more than 60% in the first quarter as investors came to terms with a global oil glut, ending the first three months of that year at $10.42 a barrel. Crude clawed back less than half of those losses first-quarter losses, ending 1986 with an annual loss of nearly 32%.
Stocks rallied in 1986 but posted a third-quarter pullback of 7.8% before ending the year with a 14.6% annual gain and then adding another 20.5% in the first quarter of 1987. (Stocks famously crashed in October 1987, leaving the S&P 500 to eke out a 2% annual gain for the year.)
In an echo of 1986, Minerd said he sees an eventual bottom in oil having a positive impact on equities in terms of earnings and a “positive feedback loop” to consumers, who will benefit from lower energy prices. http://www.marketwatch.com/story/oil-could-fall-below-30-a-barrel-but-heres-why-thats-a-good-thing-2015-03-30