Dow, S&P close at records as energy shares rise
US stocks rise with the Dow and S&P 500 eking out closing records as higher energy shares offset concerns about a sharp sell-off in Chinese stocks.business Updated: Jun 05, 2007 09:30 IST
US stocks rose on Monday, with the Dow and the S&P 500 eking out closing records, as higher energy shares and a fresh round of takeovers offset concerns about a sharp sell-off in Chinese stocks.
Wal-Mart Stores Inc rose 3.5 per cent, boosting the Dow and the S&P, after several brokerages raised their ratings on the retailer's shares.
Energy stocks led the S&P higher as oil climbed above $70 in London on news that a cyclone was headed toward the oil-producing Arabian peninsula with the potential to disrupt supply. Shares of Chevron Corp rose 1.1 per cent to $83.13.
China's domestic stock market fell 8 per cent, its fourth straight losing session, following last week's hike in the tax on stock trades. Even so, major Asian markets ended higher, and European markets were only slightly lower on Monday. US stocks fell in early trading, but clawed their way back.
"There was a big decline in the Chinese market overnight, but that's nothing new. I don't think anyone should make any inferences about the US market from an overextended Chinese market," said Brian Gendreau, investment strategist at ING Investment Management in New York.
The Standard & Poor's 500 Index gained 2.84 points, or 0.18 per cent, to 1,539.18, finishing at a record for the fourth straight session.
The Dow Jones industrial average rose 8.21 points, or 0.06 per cent, to end at a record 13,676.32.The Nasdaq Composite Index advanced 4.37 points, or 0.17 per cent, to close at 2,618.29.
London Brent crude, currently seen as a better gauge of the global market than US oil, was up $1.11 at $70.18 a barrel.
Among decliners, airline stocks fell, not only on higher oil prices, but also on worries about weak revenues.
Continental Airlines shares fell 6.1 per cent after the company reported lower revenues per passenger in May, an early sign of weakness going into the key summer travel season.
Continental Airlines shares dropped to $37.45 on the New York Stock Exchange. while UAL Corp, parent of United Airlines, fell 6.6 per cent to $36.21 on the Nasdaq.
General Electric & Co and Wal-Mart were among the top gainers in both the Dow and the S&P 500.
General Electric's stock rose almost 1 per cent to $37.81, after Barron's, the weekly financial newspaper, reported that the conglomerate may face pressure to spin off some units.
Wal-Mart shares rose 3.5 per cent to $51.21 on the NYSE. The world's largest retailer on Friday trimmed its expansion plans and announced a $15 billion stock buyback.
A string of takeover news, including a buyout of struggling subprime mortgage lender Accredited Home Lenders Holding Co., also lent support to the market.
Shares of Accredited Home Lenders surged 9.9 per cent to $15.12 in Nasdaq trading after it agreed to be acquired by private equity firm Lone Star for $400 million.