Market Wrap: Stocks Up, Driven by Energy Amid Global Tension
NEW YORK -- U.S. shares closed higher Tuesday as energy stocks rose along with oil prices after Turkey shot down a Russian warplane near the Syrian border.
The three major U.S. indexes recovered from a morning sell-off that was triggered by the overseas news despite some strong U.S. economic data.
%VIRTUAL-pullquote-You came in this morning and everybody was talking about this potential escalation of violence between Turkey and Russia.%Oil prices were up more than 2 percent after a spike in Middle East tensions.
"You came in this morning and everybody was talking about this potential escalation of violence between Turkey and Russia," said Andrew Frankel, co-president of Stuart Frankel & Co. in New York. He added that investors settled down after it appeared that Russia's response wouldn't be as confrontational as they initially feared.
Relatively light trading appeared to exaggerate swings in the market, according to Frankel, as many market participants were away ahead of the Thanksgiving holiday. Markets will be closed all day Thursday and close early Friday.
The Dow Jones industrial average (^DJI) rose 19.51 points, or 0.1 percent, to 17,812.19, the Standard & Poor's 500 index (^GSPC) gained 2.55 points, or 0.1 percent, to 2,089.14 and the Nasdaq composite (^IXIC) added 0.33 points -- basically flat -- to 5,102.81.
Investors steered clear of many of Nasdaq's higher-valuation stocks like Netflix (NFLX) and instead took safety in cheaper stocks due to geopolitical concerns, according to J.J. Feldman, portfolio manager at Los Angeles-based Miracle Mile Advisors.
"When you get that kind of thing people say they're going to get out of the high-flyer expensive P/E stocks and into the flight-to-quality value stocks that have been beaten down," he said.
Travel Stocks Hit
Travel-related stocks fell after the State Department issued a global travel alert for Americans. The Dow Jones Airlines index ended down 2.7 percent, led by a 5-percent decline in Allegiant Travel (ALGT). United Continental (UAL), Delta Air Lines (DAL) and Spirit Airlines (SAVE) all fell around 3 percent.
Six of the 10 major S&P sectors rose and energy led with a 2.4-percent increase, followed by a 0.8 percent increase in materials.
Hewlett-Packard (HPQ) shares fell 3.4 percent in extended trading after the close when it reported a revenue decline for the fifth straight quarter, its last before it split into two companies.
The U.S. economy grew at a 2.1 percent pace in the third-quarter, compared with an earlier estimate of 1.5 percent, data showed, but consumer sentiment in November was the weakest since September 2014 ahead of the crucial holiday shopping season.
Advancing issues outnumbered declining ones on the NYSE by 1,893 to 1,162, for a 1.63-to-1 ratio on the upside; on the Nasdaq, 1,659 issues rose and 1,121 fell for a 1.48-to-1 ratio favoring advancers.
The S&P 500 posted 9 new 52-week highs and 8 new lows; the Nasdaq recorded 63 new highs and 74 new lows.
About 6.9 billion shares changed hands on U.S. exchanges below the 7.2 billion average for the last 20 sessions, according to Reuters data.
-Abhiram Nandakumar contributed reporting from Bangalore, India.
What to watch Wednesday:
- At 8:30 a.m. Eastern time, the Labor Department releases weekly jobless claims and the Commerce Department releases durable goods for October, and personal income and spending for October.
- At 10 a.m. Eastern time, the Commerce Department releases new home sales for October; the University of Michigan reports Consumer Sentiment for November; and Freddie Mac releases weekly mortgage rates.
- Deere & Co. (DE) releases quarterly financial results before markets open in New York.