Wednesday’s Theme: Follow The Leader (Oil)
U.S. stocks were mostly higher at the end of Wednesday’s trading session. The market has now risen in two consecutive days and followed oil’s lead higher.
The price of a barrel of oil rose to its highest level since July 2015 and settled higher by more than 2 percent at $51.60 a barrel.
The Dow Jones Industrial Average gained 0.22 percent to close at 18,202.62, the S&P 500 also gained 0.22 percent to close at 2,144.29 while the Nasdaq index under-performed having gained just 0.05 percent to close at 5,246.41.
Technology stocks were haunted by Intel (NASDAQ: INTC) after the technology giant reported a better than expected third quarter but raised some alarms with a cautious fourth quarter outlook.
Specifically, the company earned $0.80 per share in its third quarter on revenue of $15.8 billion. The company earned seven cents more than Wall Street analysts were expecting and its revenue fell slightly shy of the $15.58 billion expected.
Looking forward to the fourth quarter the company guided its revenue to be $15.7 billion plus or minus $500 million while analysts were modeling $15.8 billion. The company’s poor outlook was attributed to inventory burn in the PC end market and growth and a less-than-expected growth in the data center business which offers high margins.
Investors were also cautious on technology stocks after a UK-based component supplier to Apple (NASDAQ: AAPL), Laird, issued a profit warning which has investors wondering if iPhone sales are holding up to expectations.
Needless to say the best performing sector was energy. Energy-related giants saw their stocks move notably higher, including Halliburton (NYSE: HAL) (+4.25 percent), Kinder Morgan (NYSE: KMI) (+2.63 percent) and Schlumberger (NYSE: SLB) (+2.52 percent).
Commodity related stocks were also extremely strong during the trading session. The basics material group as a whole gained 0.91 percent, led by United States Steel (NYSE: X) (+7.63 percent), Barrick Gold (NYSE: ABX) (+5.62 percent) and Freeport-McMoran (NYSE: FCX) (+3.09 percent).
The Federal Reserve released its “Beige Book” which showed that the U.S. economy continued expand, a modest employment and wage growth was observed, home prices continued to rise at a modest pace, retail spending increased and among others, the U.S. election is heavily viewed as a source of economic uncertainty.