3 Reasons Markets Finished Up For the Third Straight Day
Markets closed up on Wall Street today: Dow +1.75%, S&P +1.99%, Nasdaq +1.71%, Oil +2.85%, Gold +1.35%.
On the commodities front, Oil (NYSE:USO) climbed to $87.10 a barrel. Precious metals were also up, with Gold (NYSE:GLD) climbing to $1,766.10 an ounce and Silver (NYSE:SLV) rising 1.55% to $39.72 an ounce.
Today’s markets were up because:
1) U.S. economic data. According to the National Association of Home Builders, builder (NYSE:XHB) confidence in the market for newly built, single-family homes – the National Association of Home Builders/Wells Fargo Housing Market Index – was unchanged in August at a low level of 15. Also being reported today was an assessment of New York-area manufacturing activity, which declined for the third consecutive month and fell short of economists’ expectations. But after last week’s volatility, investors have grown used to the idea that the economic recovery has slowed, allowing positive data from other areas to overshadow the negative.
2) Japan. Japan’s (NYSE:EWJ) economy contracted less than expected in the second quarter, despite a huge blow to industry and production dealt by the March 11 earthquake and tsunami. Gross domestic product declined at an annualized rate of 1.3% in the quarter ending June 30. Economists had forecast a 2.5% decline. In the second half of the quarter, many Japanese companies, including Toyota (NYSE:TM) expect to fully recover to previous production levels, or even exceed previous levels in order to make up for lost revenue in the months following the earthquake.
3) Crude futures. After tumbling considerably over the past few weeks, crude-oil futures began to recover today. Crude for September delivery climbed roughly 3% today on the New York Mercantile Exchange, giving energy stocks a boost. Exxon Mobil (NYSE:XOM), BP (NYSE:BP), Marathon (NYSE:MRO), and Chevron (NYSE:CVX) all gained over 3% today