Stocks Reach New Record Highs Amid Jump In Oil Prices - U.S. Commentary

(RTTNews) - Stocks moved mostly higher over the course of the trading session on Monday amid relatively light pre-holiday trading activity. With the upward move, the major averages ended the session at new record closing highs.

The major averages finished the day near their best levels of the session. The Dow rose 88.76 points or 0.5 percent to 18,956.69, the Nasdaq advanced 47.35 points or 0.9 percent to 5,368.86 and the S&P 500 climbed 16.28 points or 0.8 percent to 2,198.18.

A sharp increase by the price of crude oil contributed to the strength on Wall Street, with crude for December delivery jumping $1.80 to $47.49 a barrel.

The price of crude oil benefited from optimism that OPEC members will agree to reduce output at a meeting next week.

News on the merger-and-acquisition front also generated some buying interest, although trading activity remained somewhat subdued ahead of the Thanksgiving Day holiday.

The economic calendar for the holiday-interrupted week also started off relatively quiet, with no major U.S. data scheduled for today.

The National Association of Realtors is due to release a report on existing home sales on Tuesday, although the real fireworks will be on Wednesday.

Reports on weekly jobless claims, durable goods orders, new home sales, and consumer sentiment are all due to be released on Wednesday ahead of the Thanksgiving Day holiday on Thursday.

The Federal Reserve is also scheduled to release the minutes of its latest monetary policy meeting, which could shed some additional light on the outlook for interest rates.

Among individual stocks, shares of Applied Micro Circuits (AMCC) moved sharply higher after the chip maker agreed to be acquired by Macom (MTSI) for $770 million in cash and stock.

Building products company Headwaters (HW) also posted a standout gain after agreeing to be acquired by Australian construction firm Boral in a deal valued at $2.6 billion.

On the other hand, shares of Tyson Foods (TSN) came under pressure after the food giant reported weaker than expected fourth quarter results and provided disappointing guidance.

Sector News

Benefiting from the spike by the price of crude oil, energy stocks showed a substantial move to the upside on the day.

Reflecting the strength in the sector, The NYSE Arca Natural Gas Index surged up by 3.8 percent, while the NYSE Arca Oil & Gas Index and the Philadelphia Oil Service Index jumped by 2.7 percent and 2.1 percent, respectively.

Steel stocks also turned in a strong performance, driving the NYSE Arca Steel Index up by 2.4 percent. Brazil's CSN (SID), Mechel (MTL), and A.M. Castle (CAS) posted notable gains.

Chemical, gold, internet and railroad stocks also saw considerable strength, moving higher along with most of the other major sectors.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Monday. Japan's Nikkei 225 Index advanced by 0.8 percent, while Australia's All Ordinaries Index dipped by 0.2 percent.

Meanwhile, the major European markets all moved higher on the day. While the U.K.'s FTSE 100 Index closed just above the unchanged line, the German DAX Index edged up by 0.2 percent and the French CAC 40 Index climbed by 0.6 percent.

In the bond market, treasuries saw early strength but pulled back to end the day roughly flat. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, inched up by less than a basis point to 2.339 percent.

Looking Ahead

Trading on Tuesday may be impacted by reaction to the National Association of Realtor's report on existing home sales in the month of October.

On the earnings front, Brocade (BRCD), Copart (CPRT), Dycom (DY), Jack In The Box (JACK), and Weibo (WB) are among the companies releasing their quarterly results after the close of today's trading.

Barnes & Noble (BKS), Campbell Soup (CPB), Dollar Tree (DLTR), Medtronic (MDT), and Tech Data (TECD) are also due to report their results before the start of trading on Tuesday.