S&P 500, Nasdaq hit record highs as oil price rise boosts energy stocks

Photo: Reuters

The Nasdaq Composite and the S&P 500 touched record highs in late morning trading on Monday as a rise in oil prices boosted energy stocks and investors shrugged off the impact of a global cyber attack.

Oil hit its highest in more than three weeks after top exporters Saudi Arabia and Russia said supply cuts needed to last into 2018, a step towards extending the Organisation of the Petroleum Exporting Counties (Opec)-led deal to support prices for longer than originally agreed.

Shares of oil majors Exxon and Chevron helped boost the S&P energy index, which was on track to close higher for the first time in three sessions.

“The rebound in oil prices and lack of bad news on the geopolitical front has led to a bit of a relief rally in equities,” said Randy Frederick, vice president of trading and derivatives for Charles Schwab in Austin, Texas.

“At this level, there isn’t too big a correlation between oil and equities but since we’ve seen oil fall quite a bit in a month or so, today’s rally in oil is helping the market grind higher.”

At 10:53 am ET (14:53 GMT), the Dow Jones Industrial Average was up 89.46 points, or 0.43 per cent, at 20,986.07. The S&P 500 was up 12.54 points, or 0.52 per cent, at 2,403.44 and the Nasdaq Composite was up 30.37 points, or 0.50 per cent, at 6,151.61.

All the 11 major S&P 500 sectors were higher, with the energy and materials index leading the gainers.

Investors seemed to mostly shrug off fears from a successful missile test by North Korea and a cyber attack that disrupted operations at car factories, hospitals, shops and schools.

Shares of cybersecurity firms such as Fireye, Symantec and Palo Alto Networks were all up.

Cisco’s 2.5 per cent rise provided the biggest boost to the Nasdaq and S&P.

US stocks slipped on Friday, ending the week lower as tepid economic data weighed on banks and worries deepened over department stores.

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