Energy helps Wall Street rebound, Oil down after Japan earthquake

13:19, March 12, 2011      

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U.S. stocks rebounded on Friday, lifted by energy and material shares while oil prices fell sharply in the wake of Japan's earthquake.

The magnitude 8.8 earthquake slammed Japan, the third biggest oil consumer in the world, on Friday, causing severe damages to its cities and mounting death tolls and injuries.

Considering Japan's huge oil consumption, around 4.4 million barrels a day, investors feared the demand would fall after the disaster at least temporarily, triggering large scale of sell-offs across markets.

Light, sweet crude for April delivery felled to below 100 dollars a barrel for the first time in more than a week before settling at 101.16 dollars a barrel on the New York Mercantile Exchange. Meanwhile, crude also posted its first weekly loss in four weeks, dropping 3.26 dollars, or 3.12 percent.

However, U.S. equities were not heavily hit by the news even as there were concerns that the tsunami could hit as far away as Hawaii and the West coast of the United States.

U.S. investors expected that the quake wouldn't significantly hurt global economic growth. Rather, traders bet that the quake would actually drive increased demand for a host of economically sensitive companies when Japan starts to rebuild what was damaged by the quake.

Energy producers and infrastructure providers were among the best performers while insurers lagged in the market after the quake.

Further lifting the market, the Commerce Department said on Friday that the U.S. retail sales climbed 1 percent last month, the highest increase in four months, as Americans took advantage of more seasonable weather to buy cars, clothes and electronics, showing consumers are not yet showing much bad effects from rising food and energy prices

As of Friday's close, the Dow Jones industrial average gained 59.48 points, or 0.50 percent, to 12,044.09. The Standard &Poor's 500 Index was up 9.17 points, or 0.71 percent, to 1,304.28. The Nasdaq climbed 14.59 points, or 0.54 percent, to 2,715.61.

Source: Xinhua

 
 
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