Wall Street reversed early losses to close higher today, as investors monitored the movements of record high oil prices but still laid bets...
NEW YORK — Wall Street reversed early losses to close higher today, as investors monitored the movements of record high oil prices but still laid bets that the economy and companies are in recovery mode.
Crude oil climbed to a record near $123 a barrel on the New York Mercantile Exchange as traders, who have nearly doubled the price of oil over the past year, reacted to the weakening U.S. dollar, supply threats, and a note from Goldman Sachs predicting that oil could reach $200 a barrel.
The Dow Jones industrial average rose 51.29 to 13,020.83.
Microsoft, one of the 30 Dow stocks, added 62 cents to close at $29.70. Boeing, another Dow stock, gained 23 cents to end the day at $86.15.
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The Standard & Poor’s 500 index rose 10.77 to 1,418.26. The Nasdaq composite index rose 19.19 to 2,483.31.
High oil prices threaten to crimp consumers’ discretionary spending. But oil price sticker-shock waned, and investors looked past wider-than-expected quarterly losses at Swiss bank UBS, government-sponsored mortgage company Fannie Mae, and homebuilder D.R. Horton.
“I think overall, the strength in stocks right now is on fairly firm footing,” said JPMorgan equities analyst Thomas J. Lee. “In some ways, first-quarter earnings are yesterday’s news.”
Huge quarterly losses from three major players in the financial and homebuilding industries initially sparked some stock selling today, but those dips were soon met by bargain-hunters, who are betting that those sectors are a good buy right now given their low prices.
UBS reported a loss of nearly $11 billion and said it is reducing its work force by about 7 percent. UBS shares dipped 54 cents to $33.77.
Meanwhile, Wachovia said it is nearly doubling its previously reported loss for the first quarter to $708 million after reviewing its portfolio of bank-owned life insurance. Wachovia’s stock rose 30 cents to $30.08.