Wall Street gains through whippy oil price movements

Stocks on Wall Street were broadly stronger in late trading, led higher by healthcare companies such as UnitedHealth Group and Eli Lilly & Co, amid sharp movements in oil prices on inaccurate reports that the US and Iran peace deal was close.

Earnings season remains closely in focus with Netflix and SpaceX due to report after the bell, while 3M gained after raising its earnings outlook for a second quarter in a row and toymaker Hasbro surged on strong demand for its Magic: The Gathering card game.

European stock markets were broadly weaker as France’s political unrest continues to weigh on investors, with French grocer Carrefour cutting its outlook as protests threaten to dent consumer spending.

And Australian futures are pointing to a positive start to the day for the ASX, while dairy prices rose in the latest Global Dairy Trade auction.

Trading on headlines

Brent crude oil futures were down 0.7% at US$108.77 a barrel at 7am in Auckland, having traded in a range of US$106/barrel-to-US$112/barrel through the session as traders digested reports that the US and Iran were considering a compromise deal that were subsequently dashed as inaccurate.

“The price action highlights the market’s sensitivity to fresh news on the US/Iran conflict,” Bank of New Zealand senior markets strategist Jason Wong said in a note. “The swing in oil prices triggered some intraday moves in US equities and Treasuries, but net movements have been modest.”

Wall Street was broadly stronger, with the Dow Jones Industrial Average up 1% in late trading, led by a 5.6% gain for 3M after the Scotch Tape maker beat earnings expectations and raised its forecast for a second quarter in a row.

Healthcare companies were broadly stronger, with UnitedHealth, Merck & Co and Amgen at the top of the Dow’s leaderboard, while Eli Lilly hit a record high.

The S&P 500 gained 0.4%, and the tech-heavy Nasdaq Composite was up a more modest 0.2%, with earnings from the major artificial intelligence hyperscalers high on investors’ minds.

Results from SpaceX, Netflix and United Airlines after the closing bell are keenly awaited, ahead of Meta Platforms on Wednesday in the US.

Hasbro surged 10% as the toymaker’s Magic: The Gathering card game continued to drive the firm’s sales and profit.

Among other US companies reporting, General Motors declined as the automaker narrowed its earnings outlook on sliding sales, Halliburton advanced on its prediction of years of growth as nations rebuild their oil supplies and repair infrastructure, and GE Aerospace fell as it warned of supply delays even as it raised its annual outlook.

RTX slipped despite raising its outlook on robust global air travel and increased demand for military hardware, and Northrop Grumman jumped on strong growth in its aeronautics and defence units.

Still uneasy

Across the Atlantic, stock markets were weaker with the UK’s FTSE 100 down 0.3%, Germany’s DAX slipping 0.1% and France’s CAC 40 slipping 0.4% as investors continued to fret over the unrest in France.

French grocer Carrefour edged higher even as the company cut its earnings outlook on the expectation that protests would crimp consumer spending in the holiday period, while Germany’s Adidas edged higher after lifting its profit guidance on US tariff refunds.

Ukrainian President Volodymyr Zelenskyy met White House envoys Steve Witkoff and Jared Kushner, saying both sides were still working on brokering a ceasefire on attacking energy infrastructure. Witkoff will meet Russian leadership on Wednesday in St Petersburg.

Meanwhile, Alberta voters rejected separating from Canada, according to projections from the Canadian Broadcasting Corp, avoiding a political crisis as the North American nation comes under increasing pressure from the US.

Australian futures are pointing to a 0.4% gain for the S&P/ASX 200 index when trading opens across the Tasman, while the kiwi dollar traded at 56.86 US cents at 7am from 56.76 cents yesterday.

Reserve Bank of Australia deputy governor Andrew Hauser is due to speak at the Citi Investment Conference in Sydney. The kiwi dollar traded at 81.19 Australian cents from 81.26 cents yesterday.

The GDT price index rose 2.5% at the latest Global Dairy Trade auction, for an average winning price of US$4,021 a tonne. Whole milk powder prices were up 4.4% at US$3,760/tonne.

Local data today include the Reserve Bank’s credit card spending and balances for September.

The local annual meeting season continues, with Fletcher Building, SkyCity Entertainment Group, Ebos Group, Skellerup Holdings and Vulcan Steel hosting shareholders today.

Reporting by Paul McBeth. Image from Chris LeBoutillier on Unsplash.