Wall Street closes higher lifted by energy; Treasury yields rise

Tue Nov 3, 2015 4:41pm EST
 
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By Sinead Carew

NEW YORK (Reuters) - U.S. stocks closed higher on Tuesday, adding to the previous session's rally as rising oil prices boosted the energy sector, while U.S. Treasury yields rose on speculation about a possible December Federal Reserve interest rate hike.

After a volatile morning, U.S. stocks settled into positive territory in the afternoon. The Nasdaq 100 index of major companies closed at a record high, driven by technology stocks while the S&P 500 touched its highest since late July.

The Dow Jones industrial average's gain was led by oil company Chevron (CVX.N: Quote), while rival Exxon Mobil (XOM.N: Quote) was one of the biggest drivers for the S&P 500.

While energy stocks have risen 22 percent since late August, the sector is still down 10 percent year to date.

"I think there has been a real desire on the part of some investors to take advantage of depressed valuations,” said Eric Wiegand, senior portfolio manager with U.S. Bank Wealth Management in New York.

But while investors piled into the beaten-down sector, Robert Pavlik, chief market strategist at Boston Private Wealth in New York, questioned whether it would continue to rise.

"You have to be careful with that trade because there doesn't seem to be a dramatic increase in (oil) demand," he said. "I can't see oil dramatically reversing to the upside so I'm participating in it but doing it cautiously."

The Dow Jones industrial average .DJI rose 89.39 points, or 0.5 percent, to 17,918.15, the S&P 500 .SPX gained 5.74 points, or 0.27 percent, to 2,109.79 and the Nasdaq Composite .IXIC added 17.98 points, or 0.35 percent, to 5,145.13.   Continued...

 
Traders work on the floor of the New York Stock Exchange November 2, 2015. REUTERS/Brendan McDermid