Want to know why the Dow Jones Industrial Average is doing what it's doing? Check back here for a semi-live look at the volatile markets from Barron's reporters.
12:33 p.m. Oil stocks rallied on Friday morning after OPEC members signed an agreement to boost crude oil production.
US crude oil futures increased 3.6% to $67.9, while Brent Crude rose 2.3% to $74.71 after the annlouncement. That helped boost energy stocks, as shares of Chevron (CVX) were up 3.1% at $126.37, Exxon Mobil (XOM) rose 2.8% at $81.73 and ConocoPhillips (COP) surged 4.5% to $68.06. New York-listed American depositary receipts for Royal Dutch Shell (RDS.B) were also up 3.8% at $72.64, while Total (TOT) and BP (BP) jumped 3.6% and 3.8% respectively.
Paul Sankey, energy analyst Mizuho, believes the theme now is "real barrels." "OPEC may lift the 1.8 million barrels a day cut, but only be able to deliver 1 million as some producers like Libya is losing around 700 thousand barrels a day, due to ongoing civil war. The bottom line is we are looking for one million barrels headline increase from OPEC," he explains. He feels there is a concerted effort to lower prices. "If it fails, we are at risk of going very high by next summer's peak demand season," he said.
For today, at least, it's been good news for the Dow Industrial Average. The blue-chip benchmark has gained 166.31 points, or 0.7%, to 24,628.01, while the S&P 500 has increased 0.4% to 2,760.90. The tech-heavy Nasdaq Composite shed 0.1% to 7702.21. The Energy Select Sector SPDR ETF (XLE) has gained 2.8% to $75.72.
Over the past few months, airline stocks have been under pressure as the rising price of oil will increase their fuel costs and cut into their profits, and that pressure is on again today. Delta Air Lines (DAL) has declined 1.6% to $52.88, while American Airlines Group (AAL) has dropped 1% to $41.48, United Continental Holdings (UAL) is down 0.8% to $73.84, and Southwest Airlines (LUV) decreased 1.1%.
Dow Gains 104 Points as Oil Lifts Stocks
7:37 a.m. Can the Dow Jones Industrial Average avoid its worst losing streak since 1978? It's sure going to try. Futures on the blue-chip benchmark have risen 104 points, or 0.4%, while S&P 500 futures have gained 0.4%, and Nasdaq Composite futures have advanced 0.3%.
Yes, headlines about tariffs continue to pop up-- Reuters has a story today about China's media call U.S. trade policy a " symptom of paranoid delusions." They've been countered by optimism around this weekend's Opec meeting, where Saudi Arabia and Iran are said to be discussing a deal to raise production but not by so much that it will crater oil price s, helping Chevron (CVX) gain 1% to $123.84 in pre-open trading.
Not helping: The results of the U.S. Federal Reserve's bank stress tests. While all banks passed, Morgan Stanley (GS) and Goldman Sachs (GS) did it by the skin of their teeth, and both stocks are trading lower this morning. JPMorgan Chase (JPM), Bank of America (BAC) and Citigroup (C), however, have edged up this morning.
Call it a wash. - Ben Levisohn
Sign up to Review & Preview, a new daily email from Barron's. Every evening we'll review the news that moved markets during the day and look ahead to what it means for your portfolio in the morning.