Expectations that the Federal Reserve will be slow to raise interest rates after a weak jobs report last week helped send the stock market up on Monday. A jump in the price of crude oil set off a rally in energy stocks.
The stock market was closed Friday when the Labor Department reported that employers added just 126,000 workers to their payrolls in March, the smallest increase since December 2013. It was another sign of weaker economic growth in winter and increased pressure on the Federal Reserve to delay raising rates from near zero. Low rates have helped stocks soar over the last six years.
David Lefkowitz, senior equity strategist at UBS, said that calming words from William Dudley, president of the New York Fed, encouraged investors. In a speech Monday morning, Mr. Dudley pointed to the recent shaky economic news and said he expected the Fed’s rate increases would be “shallow.”
“If Fed officials think the economy is not strong enough, they’re not going to do anything to jeopardize the economic recovery,” Mr. Lefkowitz said. “With inflation low and well contained the Fed can be patient. There’s nothing forcing their hand.”
The Standard & Poor’s 500-stock index gained 13.66 points, or 0.7 percent, to close at 2,080.62. The Dow Jones industrial average rose 117.61 points, or 0.7 percent, to 17,880.85, and the Nasdaq rose 30.38 points, or 0.6 percent, to 4,917.32.
“Had the market been open on Friday, we would have probably had a triple-digit decline in the Dow,” said Hank Smith, chief investment officer at Haverford Trust. “The fact that we had a weekend to digest put it in perspective.”
Mr. Smith said he thought the economy was tracing a route laid in previous years when rough winters gave way to stronger springs.
“This is déjà vu,” he said. “There was no polar vortex, like last year, but you clearly had weather in New England that was much more severe than last year.”
The Institute for Supply Management reported Monday that companies in the service industry expanded at a slightly slower pace in March. The institute’s services index slipped to 56.5 last month, from 56.9 in February. Any reading above 50 reflects growth.
Benchmark United States crude jumped an even $ 3, or 6 percent, to settle at $ 52.14 a barrel on the New York Mercantile Exchange. That set off a rally in energy-sector stocks. Transocean, an operator of drilling rigs, soared $ 1.52, or 10 percent, to $ 16.51.
Major markets in Europe were closed for Easter Monday. In Asia, Japan’s Nikkei 225 closed with a loss of 0.2 percent, while Seoul’s Kospi gained 0.1 percent. India’s Sensex surged 0.9 percent. Stock exchanges in Australia and China were also closed.
Back in the United States, Ventas announced plans to buy Ardent Medical Services, a privately owned hospital chain, for $ 1.75 billion and spin off most of its skilled-nursing facilities. Ventas, an investment trust focused on health care, surged $ 3.67, or 5 percent, to $ 76.90.
Government bond prices fell, driving the yield on the 10-year Treasury note up to 1.90 percent.
In commodity trading, prices for most precious and industrial metals continued their recent climb. Gold gained $ 17.70 to settle at $ 1,218.60 an ounce, while silver rose 41 cents to $ 17.11 an ounce. Copper slipped 2 cents to $ 2.72.
Brent crude oil, the international benchmark used by many American refineries, rose $ 3.17, or 6 percent, to $ 58.12 a barrel on the ICE exchange in London.
In other futures trading on the Nymex, wholesale gasoline rose 8.1 cents to close at $ 1.843 a gallon; heating oil rose 8.2 cents to close at $ 1.764 a gallon; natural gas fell 6.3 cents to close at $ 2.650 per 1,000 cubic feet.
stock market – Bing News