The stock markets in the United Stated rallied again today driven by the stabilizing oil prices, which boosted the equities of companies in the energy sector.

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Today the price of Brent crude oil climbed 5.71% to $52.40 per barrel while the WTI crude oil increased 5.15% to $57.57 per barrel. Market observers believe that the Brent entered the bull market given the fact that it was more than 20% above its closing price on January 13.

Commenting on the current trends in the oil market, Bruce Bittles, chief investment strategist at RW Baird & Co. told Bloomberg, “The fact that oil is stabilizing takes some edge off the argument that the global economy is really in trouble. The markets are a little oversold after being down in January, which is also part of the strength today.”

The oil prices rebounded due the U.S. refinery strike. The prices of petroleum products increased amid concerns that the situation could shutdown oil production.

[drizzle]Bob Yawker, director of futures division at Mizuho Securities opined that several factors helped pushed the market higher including the refinery strike and the announced plan of major oil companies to reduce capital spending this year.

U.S. Markets

  • Dow Jones Industrial Average (DJIA) – 17,666.40 (+1.76%)
  • S&P 500- 2,050.03 (+1.44%)
  • NASDAQ- 4,727.74 (+1.09%)
  • Russell 2000- 1,196.65 (+1.80%)

European Markets

  • EURO STOXX 50 Price EUR- 3,414.18 (+1.31%)
  • FTSE 100 Index- 6,871.80 (+1.32%)
  • Deutsche Borse AG German Stock Index DAX- 10,890.95 (+0.58%)

Asia-Pacific Markets

  • Nikkei 225- 17,335.85 (-1.27%)
  • Hong Kong Hang Seng Index- 24,554.78 (+0.29%)
  • Shanghai Shenzhen CSI 300 Index- 3,437.45 (+2.49%)

Stocks in Focus

The stock price of Office Depot surged more than 21% to $9.28 per share due to the report that it is in advance merger negotiations with Staples. Starboard Value has been pushing both companies to consider a merger. The activist hedge fund owns significant stakes in both companies. The shares of Staples climbed almost 11% to $19.01 per share today.

National-Oilwell Varco declined more than 4% to $54.08 per share. The company reported that its net profit declined to $595 million or $1.39 per share in the fourth quarter from $658 million or $1.53 per share in the same period last year.

The shares of Whiting Petroleum increased more than 12% to $37.23 per share. The company benefited from the increasing oil prices and positive comments from analyst at Stifel Nicolaus. The research firm upgraded the stock to Buy citing the reason that Whiting Petroleum is on the right path given the improvement of its balance sheet.

 

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