US Stocks Rally after Strong Economic Data

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US Stocks Rally after Strong Economic Data

US stocks index futures rose slightly, after-day drop by the S&P 500 as oil prices advanced, ahead of the flurry of the economic data.

The benchmark S&P index dropped more than 1% on Wednesday and shed 2.4% over the past three sessions, its worst run in around two months, as weakness in oil prices weighed heavily on the energy sector, as reported by Reuters.

Falling prices of oil have increased worries on global demand and have raised concerns about earnings for energy companies. Brent crude climbed back above $65 but remained near lows of five years while US crude gained 1.15 to $61.60.

The Dow Jones Industrial Average recouped most of its losses from Wednesday with its components gaining. Exxon Mobil Corp and Home Depot Inc were among some of the top gainers.

The Nasdaq Composite index was outperforming the other indexes.

Jeffrey Carbone, senior partner at Conerstone Financial Partners was quoted by Market Watch as having said, “It was only a matter of time before we could see benefits of lower gasoline prices and it happened at a time when consumers normally spend a lot on gifts.”

Carbone said that while the rapid decline in oil prices has spooked many investors in the past few days, economic fundamentals remain the same and he is expecting a rise in confidence.

Office Depot rose 9.9% to $7.39 and Staples Inc climbed 11.4% to $16.50 before the opening of the bell after Starboard Value LP, an activist investor disclosed stakes in both office supply retailers in a move that might set up a potential merger.

European shares edged lower with the slump in iron ore and oil prices weighing on several resource-related stocks. However, the declines were curbed by expectations for further monetary stimulus from the European Central Bank. In Asia, the stocks fell with falling prices of oil being added to concerns for global growth.

To contact the reporter of the story: Jonathan Millet at john@forexminute.com