After one of the roughest days in recent history, the week closed out on a high note as stock made their largest gain in more than a month. Oil prices surged, energy stocks jumped and tech stocks like Apple had some of their best days since last summer. US crude prices were the star of the show following a rally of 9%. The Dow increased by 1.3%, just over the 16,000 threshold and the S&P recovered by 2 percent to 1906.9. The Nasdaq composite realized its biggest gain since the beginning of the 3rd quarter, which resulted in a turn around of nearly 3% (2.7 percent).
For the first time in 4 weeks, the market rallied as the idea of an economic stimulus in Europe gave investors comfort and put them in a mood to buy. Even Japan’s Nikkei 225 index saw its best day in four months with investors hoping to see the Bank of Japan throw its hat into the ring. Remember that Wednesday we saw one of the roughest sessions in recent weeks after the Dow plummeted 565 points.
“It’s going to continue to be a struggle,” said Jim Paulsen, chief investment strategist for Wells Capital Management. “Everyone will be convinced we’re heading for recession, everyone will be convinced we’re in a bear market.”
In spite of this, there was little evidence that this is the case; at least for now. U.S. crude jumped to $32.19 a barrel (finally more than a bucket of KFC Chicken), and Brent crude rose 10% to $32.18 in London. U.S. oil also rallied 21 percent over the last few days and has been able to recover about half of the losses from earlier this year. Even with this brief turn around, investors remain skittish with regard to lower energy prices. Many think that this could indicate a much bigger problem: a slowdown in the global economy.
Even with this, sentiment for the mean time has remained high. The tech sector lifted and was helped in major part from Apple shares rose a little over 5 percent an broke back above $100. Even Facebook, who has suffered in previous weeks, saw a 4 percent boost to just under $98. Telecomm and other utilities stocks followed suit having moved up about 1 percent.