Dow Hitches Ride on Energy Sector as Hopes for Extended Production Cuts Boost Oil
Investing.com
Published Jun 02, 2020 01:00PM ET
Updated Jun 02, 2020 03:03PM ET
By Yasin Ebrahim
Investing.com – The Dow climbed Tuesday, led by energy, as investors weighed the effect of widespread protests in the U.S. against ongoing progress to reopen the economy.
The Dow Jones Industrial Average rose 0.63%, or 160 points, the S&P 500 gained 0.41%, while the Nasdaq Composite added 0.22%.
Against ongoing violent protests over the death of George Floyd that extended overnight, investors continued to bet that disruptions to the progress of reopening are unlikely to knock the odds of a recovery in the second half of the year.
Cyclical corners of the market sensitive to the reopening progress such as manufacturers, energy companies, and banks continued to catch a bid.
Citigroup (NYSE:C) and Morgan Stanley (NYSE:MS) were up about 2%, while Bank of America (NYSE:BAC) rose 0.55% after pledging to commit $1 billion over four years to support economic and racial inequality accelerated by a global pandemic.
Energy also led the broader market higher, supported by a jump in oil prices to nearly three-month highs on expectations that major producers will extend production cuts when they meet virtually later this week.
RBC Capital Markets' Helima Croft said major oil producers are expected to agree a one- to three-month extension.
But tech lagged the move higher, as FAANG stocks stumbled, pressured by Facebook (NASDAQ:FB) as the social media company came under scrutiny for failing to take action on a post from President Donald Trump that appeared to threaten to start shooting looters.
Shares of Apple (NASDAQ:AAPL) were flat after the tech giant cut the prices of its latest iPhones in China ahead of a major online shopping festival on June 18.
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