The U.S. stock markets ended the trading session higher with the S&P 500 moving towards its longest winning streak this year. The equity markets benefitted from speculations that the worst is over and the U.S. economy is strong enough to support corporate earnings, according to Bloomberg.
Today, the S&P gained 1.83% to 1,987.05 points, the Dow Jones climbed 1.85% to 16,776.43 points, the NASDAQ jumped 1.56% to 4871.26 points, and the Russell 2000 went up 2.47% to 1,141.64 points.
In an interview with Bloomberg, Michael Purves, chief global strategist at Weeden & Co said the market’s upward momentum was “simply a response to oversold conditions.” He added, “Pushing out interest rate hike expectations to next year has been critical.”
Since the selloff August, the U.S. equity markets have been trading up and down due to investors’ concern regarding the slowing global economy particularly in China, and confusion regarding the Federal Reserve’s statements on interest rates.
Market correction seems over
According to Otto Waser, chief investment officer at R & A Research & Asset Management commented the correction seems to be over given the current market reaction. He noted that these people who wanted to sell did it already. He suggested, “The market should stabilize and either rally now or in the first quarter of next year. We’re looking at a very modest pace of rate increases anyway.”
Investors will now focus their attention on the earnings season this week. Market analysts estimated that the earnings for S&P 500 companies declined 6.9% in the third quarter.
Meanwhile, oil prices surged after Russia expressed it was prepared to meet with other produces to discuss the market. Russia is one of the top three oil producers worldwide. Moscow previously declined to cooperate with the Organization of the Petroleum Exporting Countries (OPEC) to defend market share.
The U.S. crude climbed 1.6% to $46.26 per barrel and the Brent rose 2.4% to $49.95 per barrel.
Stephen Massocca, chief investment officer at Wedbush Equity Management told Reuters, “The market was a bit oversold. Energy stocks are very oversold so they’re a big contributor to the rally today. Commodity names seem to be catching a bit of a bid. We’re still looking for low interest rates and the Fed to be on hold for a while.”
The stock price of Alcoa (NYSE:AA) increase more than 9% to $10.41 per share. The aluminum giant announced its $1 billion contract with Airbus Group (EPA:AIR) to supply high-tech, multi-material aerospace fastening systems.
The stock value of Airbus Group climbed more than 3% to €56.61 per share. Analysts at Goldman Sachs recently issued a Neutral rating with €66 price target on the stock while Societe General recommended a Buy rating with set a price target of €73 per share.
The shares of Consol Energy (NYSE:CNX) went up by over 9% to $10.74 a piece. Analysts at Deutsche Bank upgraded their rating on the stock to Hold with a price target of $13 per share. The company lost more than 68% of stock value year-to-date. According to Deutsche Bank, the company’s growth prospects are on the success of its asset sales in an “already crowded market.”
Micron Technology gained more than 10% to $17.57 per share. The company reported better-than-expected earnings for its fiscal fourth quarter. Micron Technology posted $3.6 billion in revenue, higher than the $3.56 billion expected by analysts. Its non-GAAP earnings were $0.37 compared with the $0.33 consensus estimate.
The stock price of SunEdison (NYSE:SUNE) increased more than 9% to $9.04 per share. The company’s management decided to optimally positions its long-term profitable growth by focusing on high-potential markets including China, India, Latin America, and the United States.
Twitter (NYSE:TWTR) shares climbed more than 7% to $28.16 per share. The board of directors of the company selected Jack Dorsey as permanent CEO and named Adam Bain as COO.
The stock price of Cadiz (NASDAQ:CDZI), a land and resource development company plummeted more than 37% to $4.91 per share. It was the biggest decliner among the companies listed on NASDAQ today. The company announced that the U.S. Bureau of Land Management (DLM) determined that the Cadiz Valley Water Conservation, Recovery and Storage Project’s proposed use was outside the scope of the Right-of-Way (ROW) of 1875. The company needs a BLM permit before proceeding with the project.
Endo International plc – Ordinary Shares (NASDAQ:ENDP) dropped more than 5% to $67.28 per share. Analysts at RBC recently reduced its price target on the stock from $107 to $100 per share, but maintained its “Top Pick” recommendation.
Sientra fell more than 21% to 8.18 per share. The stock price of the medical aesthetics company was affected by the decision of Brazilian regulatory agencies to temporarily suspend Silimed’s manufacturing of medical devices while continuing its review on technical compliance related to Good Manufacturing Practices (GMP). Silimed manufactures devices for Sientra.