A roundup of trading on major world markets:
NEW YORK – Wall Street has climbed as a strong recovery in oil prices sent energy shares sharply higher.
Volatility in oil and stock prices has been linked for much of 2016 to a degree that has surprised many investors. Wednesday’s market action extended that trend, with Brent crude rising above $US40 a barrel, continuing its recovery from decade lows that led to stock market turmoil in January.
“It’s still this puzzling correlation between the price of oil and stocks. It really is not supposed to play out this way,” said Jake Dollarhide, chief executive officer of Longbow Asset Management in Tulsa.
“But given that oil drove the U.S. stock market down, it makes sense that stocks’ rise would be tied to oil’s comeback.”
Since Feb. 11, the S&P 500 has gained 8.7 per cent, repairing some of the damage caused by the S&P 500’s worst January since 2009. The index remains down 3 per cent for 2016.
In afternoon trading, the Dow Jones industrial average was up 0.16 per cent to 16,991.02 points and the S&P 500 had gained 0.41 per cent to 1,987.35.
The Nasdaq Composite added 0.43 per cent to 4,668.78.
LONDON – Britain’s top share index rose, boosted by an increase in insurer Prudential after it announced a special dividend with better than expected results.
Prudential rose 2.9 per cent, the top FTSE 100 riser on Wednesday, after its profit was lifted by strong performances at its British, US and Asian life businesses.
“Overall Prudential remains in good shape and … has allayed investor concerns on management’s ability to deliver on strategy,” said Atif Latif, director of trading at Guardian Stockbrokers.
“The announcement of a special dividend and five per cent increase of the ordinary dividend has been well received.”
Britain’s FTSE 100 index rose 0.3 per cent at 6,146.32 points.
HONG KONG – A sharp sell-off in Chinese shares has dragged world share markets lower and boosted the safe-haven yen amid renewed concerns about the outlook for China’s economy.
Tuesday’s weak Chinese trade figures and slide in oil prices have revived global growth concerns and prompted investors to push the pause button on a rally in global stocks.
European shares opened higher on Wednesday but held below recent one-month highs, while risk aversion lifted the Japanese yen against the dollar and the euro.
In Asia, Chinese shares closed more than one per cent lower, while MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.3 per cent, down 1.4 per cent from a two-month high hit on Monday.
Japan’s Nikkei ended the day down 0.8 per cent, its lowest close in a week.
WELLINGTON – The S&P/NZX 50 Index gained 10.5 points, or 0.2 per cent, to 6,457.25.
