US stocks open higher as crude oil price recovers

Bulls need that trade to work now more than any time in the past few years.

Meanwhile, a brutal new year sell-off in oil markets also hampered investor sentiment as prices plunged as much as 5 per cent to new twelve year lows.

GAME OVER: Video game retailer GameStop sank 8.1 percent, the worst performer in the S&P 500 index. It’s that investors trying to assess currency devaluations and equity convulsions 7,000 miles away in Shanghai will at least be reassured that the American economy is holding up.

While traders said the deal made strategic sense, there was some wariness over the price offered.

Investors also welcomed encouraging economic data out of China indicating a smaller drop in the nation’s exports. It wasn’t enough to elevate the S&P 500, which slid 6 percent for the week.

At 8:28 a.m. ET (1328 GMT), Dow e-minis were up 160 points, or 0.98 percent, with 73,123 contracts changing hands.

Oil industry shares were mixed despite another drop in crude prices.

Wall Street will also be watching the start of the fourth-quarter earnings reporting season, which unofficially kicks off after today’s closing bell with a report from aluminum maker Alcoa.

“I think 2016 will be a more challenging year for global markets”, said Mr. Markham, noting valuations in the USA are quite high, and “the unconditional support from central banks which we’ve had, certainly in the USA, has come to an end”.

Earnings were key to keeping equities from caving after the selloff in August when stocks suffered the first correction since the European sovereign debt crisis in 2011.

Other leaders included UnitedHealth Group, up 2.4 percent, and Wells Fargo bank, 2.7 percent.

One of the reasons stocks have done well is the propensity of companies to beat analyst predictions when they report results. The company was the biggest gainer in the S&P 500 index.

Companies posted quarterly results that exceeded Wall Street projections by an average of 4.1 percentage points in 2015.

Last week’s 5.3 per cent fall, the FTSE’s biggest weekly drop since August, followed China’s move to weaken the yuan, which rattled global markets.

While lower oil prices are traditionally viewed as a boon for consumers and the economy more broadly, recent moves downward have raised the specter of bankruptcies in the energy sector, weighing on broader indexes.

Worries that turmoil in China’s stocks and currency will spread to the global economy has spurred declines in markets in 2016 – the S&P 500 posted its worst-ever start to a year, sliding 6 percent last week. “We remain very guarded in our outlook for stocks going forward at the time being”. “The big macro and geopolitical events are swamping earnings right now”.

Tokyo, which was closed Monday for a holiday, slipped 2.12 percent by lunch as dealers there played catch-up with the rest of the region and the yen strengthened against the dollar. Profits in the index are expected to approach $1 trillion in the 12 months through December, compared with $740 billion in 2007 and $490 billion in 2000, data compiled by Bloomberg show.

Health insurer Anthem Inc (ANTM.N) finished up 5.6% after it gave a profit forecast.

The S&P 500 bounced Tuesday, as expected, with higher-than-average buying for the second consecutive day.