S&P 500 opens at record high on oil gains, jobs data

By Yashaswini Swamynathan

REUTERS - The S&P 500 opened at a record high on Monday as oil prices rose and after Friday's stellar jobs report suggested strength in the U.S. economy, boosting appetite for risk.

Oil rose 1.8 percent after a report in the Wall Street Journal last week that some OPEC members had called for a freeze in production.

Seven of the 10 major S&P 500 indexes were higher, led by a 0.96 percent rise in the energy sector.

Oil majors Exxon Mobil and Chevron rose about 0.6 percent and were the top drivers of the S&P.

Gold, a traditional safe-haven asset, fell to a one-week low, while the Japanese yen remained weak, suggesting that the markets were in a risk-on mode.

"We're coming off a strong session on the back of solid economic data that the markets needed to justify additional exposure to equities," said Andre Bakhos, managing director at Janlyn Capital in Bernardsville, New Jersey.

"There is ample evidence that equities are the only game in town right now."

At 9:36 a.m. ET the Dow Jones industrial average was up 15.59 points, or 0.08 percent, at 18,559.12.

The S&P 500 was up 2.07 points, or 0.09 percent, at 2,184.94.

The Nasdaq Composite was up 5.04 points, or 0.1 percent, at 5,226.16 and is just 5 points away from its record high.

Although strong jobs report could strengthen the case for an interest rate hike, analysts have said the central bank may wait for more data before it makes the move.

While traders priced in higher rate-hike chances in the near term, they do not expect the Fed to pull the trigger even until July next year, according to CME Group's FedWatch tool.

A better-than-expected corporate earnings season and strong economic indicators have fueled a rally in equities, with the S&P 500 notching 10 record highs since July, including on Monday.

Earnings of S&P 500 companies are expected to fall 2.6 percent in the quarter, compared with the 5 percent decline expected at the start of the season, according to Thomson Reuters I/B/E/S.

Allergan shares lost 1.2 percent after the drugmaker slashed its revenue forecast for the year.

Mattress Firm shares more than doubled to $63.70 after Steinhoff International agreed to buy the company. The stock gave the second-biggest boost to the Nasdaq after Apple's 0.4 percent gain.

Advancing issues outnumbered decliners on the New York Stock Exchange by 1,775 to 870. On the Nasdaq, 1,429 issues rose and 840 fell.

The S&P 500 index showed 21 new 52-week highs and no new lows, while the Nasdaq recorded 51 new highs and four new lows.

(Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Anil D'Silva)