Consumer confidence, oil lift stocks
Better-than-expected consumer confidence numbers and a drop in oil prices sent stocks higher Wednesday, extending Wall Street’s November rally in light pre-holiday trading.
Investors were encouraged by the University of Michigan’s consumer confidence index, which came in at 81.6, slightly higher than the 81 reading Wall Street expected. That could bode well as consumers head to the malls on Friday for the start of the holiday shopping season.
Oil priced dropped after the Energy Department reported substantial increases in the nation’s fuel stockpiles. A barrel of light crude was quoted at $58.71, down 13 cents, on the New York Mercantile Exchange.
“This definitely helps the continuation of the rally,” said Peter Cardillo, chief strategist and senior vice president at S.W. Bach & Co. “From here, I see the continuation of this rally through the end of the year.”
The Dow Jones industrial average rose 44.66, or 0.41 percent, to 10,916.09.
Broader stock indicators also rose. The Standard & Poor’s 500 index added 4.38, or 0.35 percent, to 1,265.61, and the Nasdaq composite index gained 6.42, or 0.28 percent, to 2,259.98.
Bonds edged lower, with the yield on the 10-year Treasury note rising to 4.49 percent from 4.43 percent late Tuesday. The dollar was mixed against other foreign currencies, while gold prices fell.
Not all the economic news was good. A larger-than-expected increase in first-time jobless claims, which rose by 30,000 to 335,000 last week, had investors concerned that the labor market was still struggling to recover from disruptions caused by the Gulf Coast hurricanes.
The number of people who are continuing to collect unemployment claims remains high, at 2.82 million, a sign that workers laid off due to hurricanes are not easily finding jobs.
The day’s trading was unlikely to be significant to the overall market in the coming weeks, as most investors were already in vacation mode. Volume is traditionally very light during the Thanksgiving holiday week; the markets will be closed Thursday and trade in a shortened session Friday.
“This is the time of the year that the market, historically, goes up,” said Barry Berman, head trader for Robert W. Baird & Co. in Milwaukee. “There’s a sense that that rally has started and people are jumping on board.”
Advancing issues led decliners by roughly 9 to 7 on the NYSE, where volume came to 1.69 billion shares, compared to 1.56 billion traded at the same point Tuesday.
The Russell 2000 index of smaller companies rose 0.59, or 0.09 percent, to 683.14.
Overseas, Japan’s stock markets were closed for a national holiday. Britain’s FTSE 100 rose 0.26 percent, Germany’s DAX index added 0.41 percent, and France’s CAC-40 rose 0.61 percent.