Market Wrap: Wall Street Rallies After 5 Down Days

Financial Markets Wall Street
Richard Drew/AP

By Caroline Valetkevitch

NEW YORK -- U.S. stocks rallied Friday after five sessions of losses, helped by a sharp rebound in energy shares and data that signaled the U.S. economy was on track for solid growth.

U.S. consumer sentiment hit its highest in 11 years in January, while factory output rose last month, reports showed.

All 10 of the S&P 500 sectors ended higher, though energy led the charge, rising 3.2 percent. U.S. crude oil futures settled up 5.3 percent after the International Energy Agency forecast the market downtrend would end. Brent gained 3.9 percent.

%VIRTUAL-pullquote-Along with that came sturdier oil prices, and I think that's the elixir for ultimately better equity prices.%"You had a pretty strong consumer confidence report that seemed to turn the market right around," said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia.

"Along with that came sturdier oil prices, and I think that's the elixir for ultimately better equity prices ... dampening concern that low oil prices are a reflection of weak demand."

The Dow Jones industrial average (^DJI) rose 190.86 points, or 1.1 percent, to 17,511.57, the Standard & Poor's 500 index (^GPSC) gained 26.75 points, or 1.34 percent, to 2,019.42 and the Nasdaq composite (^IXIC) added 63.56 points, or 1.39 percent, to 4,634.38.

For the week, the Dow was down 1.3 percent, the S&P 500 lost 1.2 percent and the Nasdaq fell 1.5 percent.

Retail foreign exchange broker FXCM (FXCM) said it may be in breach of regulatory capital requirements following client losses related to Switzerland's move to ditch the cap on the Swiss franc's value.

Leucadia National (LUK), which owns investment bank Jefferies, will give $300 million to FXCM to meet regulatory capital requirements. Shares of both FXCM and Leucadia were halted during the session. After the close, FXCM shares resumed trading and were down 69.3 percent at $3.88, while Leucadia fell 0.9 percent.

%VIRTUAL-WSSCourseInline-975%Investors continued to assess effects of the move by the Swiss National Bank on Thursday to lift the cap on the Swiss franc. The decision could foreshadow a large stimulus by the European Central Bank next week that would further weaken the euro, or be a safeguard against a possible Greek exit from the eurozone that could potentially destabilize the bloc.

Among the biggest energy gainers, shares of Schlumberger (SLB), the world's No. 1 oilfield services provider, jumped 6.1 percent to $81.33 after it said the oil price drop was likely to have a "significantly more dramatic" impact on North America than on the rest of the world. Schlumberger derives two-thirds of its revenue from operations outside North America.

About 7.7 billion shares changed hands on U.S. exchanges, above the 7.4 billion average for the last five sessions, according to BATS Global Markets.

NYSE advancing issues outnumbered decliners 2,521 to 575, for a 4.38-to-1 ratio; on the Nasdaq, 2,075 issues rose and 669 fell, for a 3.10-to-1 ratio.

The S&P 500 posted 32 new 52-week highs and 15 new lows; the Nasdaq composite recorded 40 new highs and 108 lows.

What to watch Monday:

  • U.S. financial markets are closed for the Martin Luther King Jr. Day holiday.

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