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Energy companies lead the way as US stocks keep rising

Published 25/05/2016

US stocks rose after positive news from Europe
US stocks rose after positive news from Europe

US stocks climbed on Wednesday as investors continued to recover some confidence in the health of the global economy.

That sent oil prices higher and gave energy companies a boost, while materials companies also climbed higher.

In Europe, a round of new rescue loans for Greece was unfrozen, eliminating the risk the country will default on its debts in the next few months.

A survey of business sentiment in Germany, the largest economy in Europe, rose more than expected.

European stock indexes rose and the US market followed them. Expecting stronger demand for fuel and materials used in industry and construction, investors bought stock in energy and mining and chemicals companies.

US stocks had jumped on Tuesday after a strong report on home sales.

Investors "feel confident that perhaps we're seeing a stabilisation of growth overseas", said Quincy Krosby, market strategist at Prudential Financial. "Here in the US the economy appears to be pulling out of the first quarter slump."

The Dow Jones industrial average advanced 145.46 points, or 0.8%, to 17,851.51. The Standard & Poor's 500 index rose 14.48 points, or 0.7%, to 2,090.54. The Nasdaq composite index added 33.84 points, or 0.7%, to 4,894.89.

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