U.S. stocks surge as weaker dollar bolsters oil, basic materials
United States stocks rose sharply on Thursday continuing their dramatic rebound from a massive sell-off at the start of the new-year, as a plummeting dollar helped push oil prices above $40 a barrel for the first time in more than three months.
The rally came at the expense of the dollar, which plunged to five-month lows, one day after the Federal Reserve lowered its interest rate forecast for the near-term future.
The weak dollar provided a boost to major companies with strong foreign exposure, whose earnings have slumped over the last year as the greenback surged considerably against the euro and other major currencies.
It also supported further gains in oil, which is now up by more than 40%, since touching down to 13-year low in mid-February.
The Dow Jones Industrial Average gained 155.73 or 0.9% to 17,481.49, while the NASDAQ Composite index added 11.02 or 0.23% to 4,774.99, as the Dow closed in positive territory for the year.
The Dow closed higher for the fifth consecutive session. The S&P 500 Composite index, meanwhile, gained 13.37 or 0.66% to 2,040.59, as nine of 10 sectors closed in the green.
Stocks in the Basic Materials, Industrials and Energy industries led, each gaining at least 1.5%. Stocks in the Health Care sector lagged.
The top performer on the Dow was General Electric Company (NYSE:GE), which added 0.79 or 2.62% to 30.96, after reports that the multinational conglomerate’s advanced turboprop engine unit could carve out a $40 billion market.
The worst performer was Wal-Mart Stores Inc (NYSE:WMT), which lost 0.54 or 0.79% to 67.45. Walmart (NYSE:WMT) finished just below UnitedHealth Group Incorporated (NYSE:UNH), which fell 0.37 or 0.30% to 124.53.
Earlier on Thursday, UnitedHealth’s OptumRx group and Walgreens Boots Alliance Inc (NASDAQ:WBA) unveiled a new joint cost savings program aimed at improving consumer convenience.
The biggest gainer on the NASDAQ was SBA Communications Corporation (NASDAQ:SBAC), which added 3.74 or 3.91% to 99.31 after the wireless infrastructure company reported a decline of 5.12% in short interest, amid heavy short covering.
The worst performer was Mylan (NASDAQ:MYL), which fell 2.18 or 4.70% to 44.22, after analysts at Morningstar lowered the West Virginia-based pharmaceutical company’s credit rating to BBB-.
The top performer on the S&P 500 was FedEx Corporation (NYSE:FDX), which surged 17.13 or 11.87% to 161.40, after posting the stronger than expected quarterly earnings on Thursday, due in part to lower fuel costs and a favorable foreign exchange climate.
The worst performer was Endo International, which fell 3.94 or 11.62% to 29.97, after specialty healthcare company forecasted a lower than expected guidance.
Shares in the Malvern, Pennsylvania-based company are down by more than 50% over the last year. On the New York Stock Exchange, advancing issues outnumbered declining ones by a 2,480-640 margin.
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