Stocks end Friday riding a 4-week rally
NEW YORK - Wall Street closed higher on Friday, with stocks capping a four-week rally.
The Dow Jones industrial average rose 218 points, or 1.3 percent, to close at 17,213. The Standard & Poor's 500 index gained 32 points, or 1.6 percent, ending at 2,022. The Nasdaq composite climbed 86 points, or 1.9 percent, to finish at 4,748.
The gains nearly brought the market back to breakeven for the year. After a scary stock drop earlier this year amid talk of a possible U.S. recession, investors have gotten more confident. Since hitting a low on Feb. 11, the S&P 500 index has gained 9 percent.
Energy companies were among the biggest gainers on Friday as energy prices continued to recover. Devon Energy (DVN) surged 11 percent and Anadarko Petroleum (APC) added 9 percent.
Bank stocks also rose sharply. That sector had been beaten down in recent weeks as investors worried about loans to highly leveraged energy companies going bad.
Stocks are moving sharply higher in afternoon trading Friday following a rally in Europe and an upturn in crude oil prices. Eight of 10 industry sectors of the Standard and Poor's 500 index rose, led by energy company shares. Anadarko Petroleum rose 10 percent and Devon Energy gained 12 percent.
U.S. crude added 68 cents, or 1.8 percent, to $38.52 per barrel on the New York Mercantile Exchange after the International Energy Agency said "there are signs that prices might have bottomed out." U.S. crude has risen about 50 percent from a 13-year low of $26.21 exactly one month ago. Brent crude, which is used to price international oil, lost 80 cents, or 0.2 percent, to $40.31 a barrel.
It's been a "terrific four-week run," said Chief Equity Strategist Phil Orlando of Federated Investors, but that makes him a "little nervous." Among his worries are a steeper China slowdown, a U.S. dollar strengthening even more and hurting U.S. exports, no relief from the corporate profits drop over the last year and more surprises in the presidential election. "Don't discount the fiscal policy uncertainty of the election," he warned.
European markets rose sharply as investors hoped that the European Central Bank's latest blast of stimulus policies would help revive the region's economy. Germany's DAX gained 3.5 percent, France's CAC 40 advanced 3.3 percent and Britain's FTSE 100 rose 1.7 percent. Shares in banks, which will be supported by the ECB loans, were among the biggest gainers.
Stocks had fallen on comments by ECB chief Mario Draghi on Thursday that underscored the weakness of the 19-country eurozone economy and the desperation of monetary authorities to act. The ECB moves included three interest rate cuts, loans to banks, and an expansion to a bond-buying stimulus program.
Japan's Nikkei 225 gained 0.5 percent. South Korea's Kospi edged up 0.1 percent and Hong Kong's Hang Seng index was up 1.1 percent.
The dollar strengthened to 113.72 yen from 113.11 yen while the euro fell to $1.1157 from $1.1196.
Bond prices fell. The yield on the 10-year Treasury note rose to 1.98 percent.