Shares hit two-month high as oil edges up

Wed Mar 2, 2016 5:00pm EST
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By Dion Rabouin

NEW YORK (Reuters) - A late bounce on Wall Street, backed by a rise in oil prices, helped propel a measure of global equity markets to its highest in nearly two months on Wednesday.

The move higher in crude futures, which rose about 1 percent despite a report that showed U.S. stockpiles at a record high, spurred U.S. stocks to a higher close on the day.

The march upward by oil likely shows selling in the commodity has "washed out," said Jack Ablin, chief investment officer at BMO Private Bank in Chicago.

Oil production has hit record levels and the Organization of the Petroleum Exporting Countries, led by Saudi Arabia, has been unable to come to an agreement within its ranks or with other producers to cut or even halt production levels.

Oil prices have continued to rise despite any news of a reduction in supply or increase in demand, suggesting that sellers have largely exited the marketplace, Ablin added.

"It doesn't mean go back to the races," he said, "but I think that uncertainty of how low could it go, at least in many investors' minds, quite possibly has been answered."

Stocks were also underpinned by a report showing private sector employers in the U.S. added 214,000 jobs in February, beating economists' expectations and adding to strong manufacturing and construction spending data released earlier this week.

The Dow Jones industrial average .DJI rose 34.24 points, or 0.2 percent, to 16,899.32, the S&P 500 .SPX gained 8.1 points, or 0.41 percent, to 1,986.45 and the Nasdaq Composite .IXIC added 13.83 points, or 0.29 percent, to 4,703.42.   Continued...

Traders work on the floor of the New York Stock Exchange (NYSE) March 1, 2016. REUTERS/Brendan McDermid