Modest gains emerged in US stocks after recent losses on Friday. A sharp rally by energy stocks contributed to the strength on Wall Street. DOW ended an eight session losing streak and closed up 120 points or half a percent at 24581. The S&P added modest gains of 0.20% while thetech heavy Nasdaq ended in red. Markets were battered last week on escalating tensions between the US and China following continued trade disputes. Donald Trump's threat to impose $400 billion in additional tariffs on Chinese goods has been hovering on the markets.
US economic data has been good of late. US Conference Board said its leading economic index edged up by 0.2% in May after climbing by 0.4% in April. With improvements in a majority of components partly offset by declines in leading indicators of labor markets and residential construction, the Conference Board released a report showing a smaller than expected increase byits index of leading US economic indicators in the month of May. Meanwhile, the Conference Board said the lagging economic index advanced by 0.5% in May following a 0.4% increase in April.
US first-time claims for unemployment benefits dipped to 218,000, a decrease of 3,000 from the previous week's revised level of 221,000, according to a report released by the Labor Department on Thursday. The Labor Department said the less volatile four-week moving average also slipped to 221,000, a decrease of 4,000 from the previous week's revised average of 225,000.
The major gainers for DOW on Friday belonged to the oil industry. Exxon Mobil added 2.12% while Chevron gained 2%. Crude oil futures rebounded sharply on the cues from OPEC meet. Prices recovered from one and half month low as traders eyed the recent developments on the economic front following the US-China trade spat. A steady bounce in major stock markets helped lift sentiments further for the counter.
WTI Crude Prices gained further following this, testing near $70 per barrel after OPEC announced a moderate increase in its output for coming months. Markets remain skeptical about the course of action. OPEC noted that the oil market situation has further improved over the past six months, with the global economy remaining strong, oil demand relatively robust, albeit with some uncertainties, and with the market rebalancing evidently continuing. Moreover, the return of more stability and more optimism to the industry has been welcomed by all stakeholders, according to the oil cartel.
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