Dow Jones Industrial Average Tracks Oil Rally, Climbing Import Prices
The Dow Jones Industrial Average opened higher on Tuesday as rallying oil prices and climbing import prices overpowered any disappointment from Alcoa Inc.’s dismal kickoff to earnings season.
At 9:35 a.m. in New York, the Dow Jones index added 0.2% to 17,584.42. Twenty stocks were declining as 10 issues were advancing.
The S&P 500 advanced 0.2% to 2,045, while the tech heavy NASDAQ Composite was little changed at 4,835.
All three major U.S. stock-market indexes closed lower on Monday, erasing earlier gains ahead of earnings season kickoff.
Oil Prices Rise
Oil futures rallied on Tuesday, on bets key oil producers will agree on a production freeze at their meeting in Doha, Qatar, on Sunday. West Texas Intermediate for May delivery rose 1.1% to $40.79 a barrel. A report from China indicating an 8.8% rise in March vehicle sales also boosted the oil rally.
U.S. import prices rose in March for the first time in nine months mostly because of a rebound in the price of gasoline, but the lingering effects of a strong U.S. dollar suggested inflation will continue to rise gradually.
Alcoa Inc (NYSE:AA) fell 4.1% to $9.32 after low commodity prices, the strong dollar, and plant closures spurred the aluminum producer to report a lower quarterly profit and cut its 2016 outlook for global sales in the aerospace industry.
Gold and silver prices are set to log a fourth day of gains on Tuesday, boosted by a generally weaker dollar. The gold price for June delivery was up 0.4% at $1,263 a troy ounce, while the silver price for May delivery added 0.9% to $16.15 a troy ounce
Elsewhere in economic news, the International Monetary Fund (IMF) on Tuesday slashed its world economic growth forecast yet again.
The organization cut its estimate for global growth to 3.2% this year and 3.5% next year. That represents a downgrade of 0.2% for 2016 and another tenth for 2017 from what it forecast in January.
Perry Ellis Gains; Juniper Tumbles
Perry Ellis International, Inc. (NASDAQ:PERY) rose 3% to $18.38 after saying it narrowed its loss in the fourth quarter, as the apparel company backed its outlook for the year amid expanding margins.
Juniper Networks, Inc. (NYSE:JNPR) tumbled 9.6% to $22.51 after the networking company said its results for the March quarter would disappoint, as it faced weaker demand.
Fastenal Company (NASDAQ:FAST) retreated 3.5% to $45.30 after the wholesale distributor of nuts, bolts, hand tools reported lower-than-expected profit in first- quarter profit as its core fastener business weakened.
Marathon Oil Corporation (NYSE:MRO) rose 2.5% to $11.96. The oil production company said it plans to divest $950 million worth of assets, and vowed to focus on lower-risk U.S. resources to protect its balance sheet against the oil price slump.
AbbVie Inc (NYSE:ABBV) gained 1.1% to $59.25 after the U.S. Food and Drug Administration granted accelerated approval for the research-based biopharmaceutical company’s blood cancer drug.
Since the beginning of the year through the close on Monday, the Dow Jones Industrial Average had gained 0.8%, compared to a 0.1 drop for the S&P 500 and a 3.5% loss for the NASDAQ.