Wall Street gains; oil's rise fuels energy shares
By Lewis Krauskopf
NEW YORK (Reuters) - Major U.S. stock indexes gained on Wednesday, boosted by financial shares amid encouraging economic data and by the energy sector as oil prices surged to June highs.
U.S. Treasury yields also rose after data showed U.S. services sector activity rebounded to an 11-month high in September, an encouraging sign for economic growth.
The Dow Jones industrial average rose 112.58 points, or 0.62 percent, to 18,281.03. The S&P 500 gained 9.24 points, or 0.43 percent, to 2,159.73 and the Nasdaq Composite added 26.36 points, or 0.5 percent, to 5,316.02.
"We’re taking a little victory lap today after the surprisingly good economic data,” said Kim Forrest, senior equity research analyst at Fort Pitt Capital Group in Pittsburgh.
U.S. stocks had been pressured this week by concerns over Britain's exit from the European Union and expectations of a Federal Reserve interest rate increase in the coming months.
Chicago Fed President Charles Evans said he would be "fine" with raising U.S. interest rates by year-end if U.S. economic data remained firm.
Traders see a 60-percent chance the Fed will hike at its December meeting, according to the CME FedWatch website. Financial shares, which tend to benefit in a rising rate environment, climbed 1.5 percent, while the energy sector gained 1.4 percent.
“People are certainly waiting for that inevitable interest rate rise by the Fed, but I think they’re just not sure if that’s a sign that things are better and earnings are likely to improve, or a reason for people to sell stocks because rates are rising," said Rick Meckler, president of LibertyView Capital Management in Jersey City, New Jersey. Continued...