Thursday, 29 September 2016

Stocks rise, oil jumps on prospect of production cut

Markets were mostly up on Wednesday.

US energy stocks jumped 4.3 percent to help drive a 0.5 percent rise in the S&P 500. The STOXX Europe 600 rose 0.7 percent.

US crude oil surged 5.3 percent after the Organization of the Petroleum Exporting Countries agreed on the need for a cut in production of crude oil.

“The cut is clearly bullish,” said Mike Wittner, head of oil-market research at Societe Generale SA.

Not everybody agrees.

Ian Taylor, the head of Vitol Group BV, said he “cannot see a good reason for a major increase in the price of oil” since the market remains “way oversupplied”.

While the jump in oil helped boost most stock markets, the Nikkei 225 fell 1.3 percent.

In bond markets, the yield on the US 10-year Treasury note rose to 1.567 percent from 1.556 percent on Tuesday.

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