Rebound By Crude Oil Leads To Higher Close On Wall Street - U.S. Commentary

(RTTNews) - Buying interest was somewhat subdued on the day, but stocks managed to end Wednesday's trading session mostly higher. With the gains, the major averages partly offset the weakness that was seen in the previous session.

The major averages ended the day in positive territory but off their recent highs. The Dow edged up 36.26 points or 0.2 percent to 17,000.36, the Nasdaq climbed 25.55 points or 0.6 percent to 4,674.38 and the S&P 500 rose 10.00 points or 0.5 percent to 1,989.26.

The higher close on Wall Street was partly due to a sharp increase by the price of crude oil, which rebounded after yesterday's steep drop.

Crude oil for April delivery jumped $1.79 to a three-month closing high of $38.29 a barrel after tumbling $1.40 to $36.50 a barrel on Tuesday.

The price of crude oil benefited from a positive reaction to the Energy Information Administration's weekly report on oil inventories.

The EIA said crude oil inventories increased by 3.9 million barrels in the week ended March 4th, matching the consensus estimate.

The report also said gasoline inventories slumped by 4.5 million barrels, while distillate fuel inventories fell by 1.1 million barrels.

Nonetheless, overall trading activity remained somewhat subdued amid another relatively quiet day on the U.S. economic front.

Traders were also looking ahead to the European Central Bank's monetary policy announcement scheduled for tomorrow.

Among individual stocks, shares of Express (EXPR) moved notably higher after the apparel retailer reported better than expected fourth quarter earnings and provided upbeat guidance.

Cable network operator Crown Media (CRWN) also posted a strong gain on news Hallmark Cards will purchase the shares of the company it does not already own for about $175 million.

On the other hand, shares of Groupon (GRPN) came under pressure after UBS downgraded its rating on the e-commerce company to Sell from Neutral.

Sector News

While many of the major sectors ended the day showing only modest moves, energy stocks saw significant strength amid the sharp jump by the price of crude oil.

Reflecting the strength in the energy sector, the NYSE Arca Natural Gas Index shot up by 3 percent, the NYSE Arca Oil & Gas Index jumped by 2.2 percent and the Philadelphia Oil Service Index advanced by 1 percent.

Considerable strength was also visible among software stocks, as reflected by the 1.6 percent gain posted by the Dow Jones Software Index. With the gain, the index reached its best closing level in over a month.

Railroad, networking, and electronic storage stocks also saw notable strength on the day, while biotechnology stocks moved to the downside.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Wednesday. Japan's Nikkei 225 Index slid by 0.8 percent and Hong Kong's Hang Seng Index edged down by 0.1 percent, while Australia's All Ordinaries Index advanced by 0.9 percent.

Meanwhile, the major European markets all moved to the upside on the day. While the French CAC 40 Index climbed by 0.5 percent, the U.K.'s FTSE 100 Index and the German DAX Index both rose by 0.3 percent.

In the bond market, treasuries gave back ground after ending the previous session notably higher. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, climbed 6 basis points to 1.892 percent.

Looking Ahead

The ECB's monetary policy announcement is likely to be in focus on Thursday, with the central bank widely expected to provide additional stimulus.

The spotlight on the ECB announcement may overshadow the U.S. Labor Department's weekly report on initial jobless claims.