Wall St rebounds from sell-off, but down for week (Reuters)

NEW YORK (Reuters) – U.S. stocks rose on Friday, bouncing back from a three-day sell-off as oil prices stabilized, but unease over the Libyan rebellion could be enough to keep buying in check.

The S&P 500 lost 1.7 percent for the week, breaking a three-week streak of gains. Friday's bounce followed a late recovery Thursday that showed buyers were ready to support shares after a bout of selling.

Analysts have been calling for a correction in stocks, with the S&P 500 up 25.8 percent since the start of September. Much weaker-than-average volume on Friday cast doubt on stocks' ability to move higher.

"It's going to be a bumpy ride. I don't think it's just one big correction and we're out of it. I think we'll see multiple, small corrections over the next few months before the market can really decide what the end game in the Middle East is," said David Kelly, the chief market strategist for JPMorgan Funds in New York.

Brent crude futures for April rose 78 cents to settle at $112.14 barrel, easing from a 2-1/2 -year high of $119.79 on Thursday after a source said Saudi Arabia raised its oil output following days of bloody unrest in fellow producer Libya.

As stocks rose, the CBOE Volatility Index, or VIX (.VIX), Wall Street's fear gauge, dropped 9.9 percent to 19.22, falling below 20 after three days of sharp gains.

The Dow Jones industrial average (.DJI) gained 61.95 points, or 0.51 percent, to end at 12,130.45. The Standard & Poor's 500 Index (.SPX) advanced 13.78 points, or 1.06 percent, to finish at 1,319.88. The Nasdaq Composite Index (.IXIC) rose 43.15 points, or 1.58 percent, to close at 2,781.05.

Volume was a low 7 billion shares traded on the New York Stock Exchange, NYSE Amex and Nasdaq, well below last year's daily average of 8.47 billion.

For the week, the Dow lost 2.1 percent and the Nasdaq declined 1.9 percent.

WATCHING LIBYA AND OIL

Stock investors have been pressured this week by worries that the turmoil in Libya could spread to other major oil-producing countries, causing gains in energy prices that could become problematic for the economic recovery.

The U.N. Security Council was to meet to discuss sanctions against Libyan leaders who are locked in a bloody battle for survival against a popular uprising.

Late last month, protests in Egypt shook the market, but stocks quickly recovered.

"The market has taken this (unrest in Libya) pretty well" so far, said Jim McDonald, Northern Trust's chief investment strategist in Chicago. Northern Trust has $643.6 billion in assets under management.

"If we see oil prices normalize back down to where they were at the end of the year because of increased stability in the Middle East, that would be constructive to global growth and investors would love that," he said.

McDonald, whose firm is "overweight" on energy shares, said as long as oil prices stay below levels that would force a recession, they are supportive for S&P 500 earnings growth.

Adding to the day's positive tone, an index of consumer sentiment rose in February to its highest level in three years, according to the Thomson Reuters/University of Michigan Surveys of Consumers.

Among top boosts to the Nasdaq were shares of Intel (INTC.O), up 2.7 percent at $21.86. Longbow started coverage of the company with a "buy" rating. A semiconductor index (.SOX) shot up 2.6 percent.

In other company news, Boeing Co (BA.N) shares rose 2.2 percent to $72.30 and led the Dow higher after the U.S. aircraft maker won a $30 billion contract to build 179 U.S. Air Force refueling planes.

Financial and material sectors led the S&P 500's gains, with shares of JPMorgan Chase (JPM.N) up 1.7 percent at $46.68.

Advancing stocks outpaced declining stocks on the NYSE by a ratio of about 4 to 1 on both the NYSE and the Nasdaq.

(Reporting by Caroline Valetkevitch; Editing by Jan Paschal)

View the original article here

Wall St rebounds from sell-off, but down for week (Reuters)

NEW YORK (Reuters) – U.S. stocks rose on Friday, bouncing back from a three-day sell-off as oil prices stabilized, but unease over the Libyan rebellion could be enough to keep buying in check.

The S&P 500 lost 1.7 percent for the week, breaking a three-week streak of gains. Friday's bounce followed a late recovery Thursday that showed buyers were ready to support shares after a bout of selling.

Analysts have been calling for a correction in stocks, with the S&P 500 up 25.8 percent since the start of September. Much weaker-than-average volume on Friday cast doubt on stocks' ability to move higher.

"It's going to be a bumpy ride. I don't think it's just one big correction and we're out of it. I think we'll see multiple, small corrections over the next few months before the market can really decide what the end game in the Middle East is," said David Kelly, the chief market strategist for JPMorgan Funds in New York.

Brent crude futures for April rose 78 cents to settle at $112.14 barrel, easing from a 2-1/2 -year high of $119.79 on Thursday after a source said Saudi Arabia raised its oil output following days of bloody unrest in fellow producer Libya.

As stocks rose, the CBOE Volatility Index, or VIX (.VIX), Wall Street's fear gauge, dropped 9.9 percent to 19.22, falling below 20 after three days of sharp gains.

The Dow Jones industrial average (.DJI) gained 61.95 points, or 0.51 percent, to end at 12,130.45. The Standard & Poor's 500 Index (.SPX) advanced 13.78 points, or 1.06 percent, to finish at 1,319.88. The Nasdaq Composite Index (.IXIC) rose 43.15 points, or 1.58 percent, to close at 2,781.05.

Volume was a low 7 billion shares traded on the New York Stock Exchange, NYSE Amex and Nasdaq, well below last year's daily average of 8.47 billion.

For the week, the Dow lost 2.1 percent and the Nasdaq declined 1.9 percent.

WATCHING LIBYA AND OIL

Stock investors have been pressured this week by worries that the turmoil in Libya could spread to other major oil-producing countries, causing gains in energy prices that could become problematic for the economic recovery.

The U.N. Security Council was to meet to discuss sanctions against Libyan leaders who are locked in a bloody battle for survival against a popular uprising.

Late last month, protests in Egypt shook the market, but stocks quickly recovered.

"The market has taken this (unrest in Libya) pretty well" so far, said Jim McDonald, Northern Trust's chief investment strategist in Chicago. Northern Trust has $643.6 billion in assets under management.

"If we see oil prices normalize back down to where they were at the end of the year because of increased stability in the Middle East, that would be constructive to global growth and investors would love that," he said.

McDonald, whose firm is "overweight" on energy shares, said as long as oil prices stay below levels that would force a recession, they are supportive for S&P 500 earnings growth.

Adding to the day's positive tone, an index of consumer sentiment rose in February to its highest level in three years, according to the Thomson Reuters/University of Michigan Surveys of Consumers.

Among top boosts to the Nasdaq were shares of Intel (INTC.O), up 2.7 percent at $21.86. Longbow started coverage of the company with a "buy" rating. A semiconductor index (.SOX) shot up 2.6 percent.

In other company news, Boeing Co (BA.N) shares rose 2.2 percent to $72.30 and led the Dow higher after the U.S. aircraft maker won a $30 billion contract to build 179 U.S. Air Force refueling planes.

Financial and material sectors led the S&P 500's gains, with shares of JPMorgan Chase (JPM.N) up 1.7 percent at $46.68.

Advancing stocks outpaced declining stocks on the NYSE by a ratio of about 4 to 1 on both the NYSE and the Nasdaq.

(Reporting by Caroline Valetkevitch; Editing by Jan Paschal)

View the original article here

Oil surge prompts stock sell-off, dollar rally (Reuters)

By Jeremy Gaunt, European Investment Correspondent Jeremy Gaunt, European Investment Correspondent – 1 hr 20 mins ago

LONDON (Reuters) – World stocks fell nearly 1 percent on Tuesday as revolt in Libya drove oil prices sharply higher, prompting fears of disruption to global economic growth.

Widespread risk aversion boosted the dollar and Swiss franc and prompted strong flows into U.S. Treasury bonds. U.S. stock index futures also tumbled, suggesting losses on Wall Street when it opens.

U.S. crude futures hit a 2-1/2 year high, rising close to 8 percent to more than $94 a barrel on the latest contract's last day of trading, as deadly clashes wracked exporter Libya's biggest cities.

Brent oil was up close to $2 a barrel at $107.60, somewhat shy of Monday's intra-day 2-1/2 year peak.

Libya is by no means the world's largest oil producer, ranking third in Africa after Nigeria and Angola, but investors are concerned about the spread of trouble and a serious disruption to supply.

"Investors are scaling down on exposure across the board," said Richard Falkenhall, currency strategist at SEB in Stockholm. "Libya is the first major oil exporting country to be affected ... if this spreads to other oil exporting countries, it will not be a good sign."

Adding to the uncertain mood, two Iranian ships entered the Suez Canal on Tuesday on their way to the Mediterranean, a move that is bound to anger Israel.

Investors are primarily concerned that Middle East/North Africa trouble will keep oil prices high, driving up inflation, cutting into corporate profits and crimping economic growth.

This could be seen most clearly on Tuesday in MSCI's benchmark emerging market stock index (.MSCIEF), which was down 1.7 percent. Leading emerging market economies are among the fastest growing in the world and the most susceptible to inflationary pressure.

Globally, world stocks as measured by MSCI (.MIWD00000PUS) were down 0.9 percent. Europe's FTSEurofirst 300 (.FTEU3) was down about 1 percent. Japan's Nikkei (.N225) earlier lost 1.8 percent.

FLIGHT TO SAFETY

The risk-averse mood triggered a broad flight to safety. The yield on 10-year U.S. Treasuries fell nearly 8 basis points to 3.505 percent. Yields on core euro zone debt lost 5 basis points to 3.131 percent.

"The situation in the Middle East is overshadowing everything else, and we've broken a series of technical levels on the way up," a trader said.

On foreign exchange markets, the dollar rallied broadly, up 0.6 percent against a basket of major currencies (.DXY) while the euro lost close to 1 percent to $1.3551.

The euro also fell 1 percent on the day to 1.2793 Swiss francs, pushing the traditional safe-haven currency to its strongest in three weeks.

Separately, the New Zealand dollar hit a near two-month low against its U.S. counterpart after investors fretted about the economic damage caused by a strong earthquake which rocked the country's second biggest city, spurring speculation about the chance of an interest rate cut.

(Additional reporting by Naomi Tajitsu and William James, editing by Mike Peacock)

View the original article here