By Sue Chang and Mark DeCambre, MarketWatch
Yellen testifies in front of House Financial Services
Committee
U.S. stocks swung higher Wednesday after OPEC took an important
step toward a cap on crude-oil output.
The Organization of the Petroleum Exporting Countries reached an
"understanding" to limit crude production
(http://www.marketwatch.com/story/opec-reaches-understanding-on-output-cut-2016-09-28-15103110)
and is considering cutting production to between 32.5 million to 33
million barrels a day, The Wall Street Journal reported.
The S&P 500 index rose 11.44 points, or 0.5%, to close at
2,171.37, led by a 4.3% surge in the energy sector.
The Dow Jones Industrial Average rose 110.94 points, or 0.6%, to
finish at 18,339.24, aided by sharp gains by energy giants Exxon
Mobil Corp.(XOM) and Chevron Corp.(CVX).
The Nasdaq Composite Index climbed 12.84 points, or 0.2%, to end
at 5,318.55.
"The nice rally in crude is one of the driving forces, along
with the bounce in Deutsche Bank," said Ian Winer, director of
equity trading at Wedbush Securities.
The potential production cut, along with a drawdown in U.S.
crude supplies
(http://www.marketwatch.com/story/crude-higher-but-market-faces-long-wait-for-next-opec-move-on-output-2016-09-28)
for a fourth week, sparked a strong rally in the crude oil market,
according to Colin Cieszynski, chief market strategist at CMC
Markets.
November West Texas Intermediate crude settled at $47.05 a
barrel on the New York Mercantile Exchange, its highest settlement
since Sept. 8
(http://www.marketwatch.com/story/crude-higher-but-market-faces-long-wait-for-next-opec-move-on-output-2016-09-28).
The Energy Select Sector SPDR ETF (XLE), which tracks the
performance of the S&P 500's energy sector, soared 4.3%, its
best percentage gain since Jan. 22, according to FactSet data.
Still, despite the initial euphoria over OPEC's move to tackle
the supply glut, some analysts questioned how effective the measure
will be given that the production cap exceeds OPEC's average of
about 30 million barrels a day.
(https://twitter.com/BullandBaird/status/781197330531876864)
The oil-fueled gains come as Federal Reserve Chairwoman Janet
Yellen wrapped up her testimony before the House Financial Services
Committee and as attention has appeared to shift away from concerns
about European banks, namely Deutsche Bank.
Deutsche Bank's U.S.-listed shares (DBK.XE)(DBK.XE) rose 3.2%
following news the troubled German lender is selling an insurance
business
(http://www.marketwatch.com/story/european-stocks-erase-monthly-loss-as-oil-firms-deutsche-bank-rally-2016-09-28),
as the country's government denied a report it is readying a rescue
plan for the bank
(http://www.marketwatch.com/story/german-government-preparing-rescue-plan-for-deutsche-bank-report-2016-09-28).
See:Deutsche Bank's woes not a Lehman moment, says UBS chairman
(http://www.marketwatch.com/story/deutsche-banks-woes-not-a-lehman-moment-says-ubs-chairman-axel-weber-2016-09-28)
Also check out: Veteran banking analyst Dick Bove believes
Deutsche Bank is 'too big to fail'
(http://www.marketwatch.com/story/veteran-banking-analyst-believes-deutsche-bank-is-too-big-to-fail-2016-09-27)
Economic News:Orders for durable or long-lasting goods flattened
out in August
(http://www.marketwatch.com/story/durable-goods-orders-lose-steam-in-august-2016-09-28)after
a sizable gain in the prior month, pointing to ongoing difficulties
for American manufacturers.
Read:
Other markets: European stocks rose, while Asian markets closed
mostly lower
(http://www.marketwatch.com/story/nikkei-leads-asia-lower-on-bank-losses-yen-strength-2016-09-28).
Gold futures fell and a key dollar index edged up.
Stocks to watch: Shares in Tempur Sealy International Inc.(TPX)
dove 22% after the mattress company lowered its 2016 guidance late
Tuesday
(http://www.marketwatch.com/story/tempur-sealy-shares-fall-as-2016-outlook-cut-2016-09-27).
Nike's stock lost 3.8% as the sportswear giant's quarterly
report late Tuesday indicated a slowdown in growth
(http://www.marketwatch.com/story/nike-sales-and-profit-rise-orders-growth-slows-2016-09-27)
for a measure of future sales.
Alphabet Inc.(GOOGL)(GOOGL) was down 0.2% after Google's parent
company was downgraded to underperform at Wedbush, which cited
concerns about a new approach for the company's search ads
(http://www.marketwatch.com/story/alphabet-shares-dip-premarket-as-wedbush-downgrades-to-underperform-2016-09-28).
BlackBerry Ltd.(BB.T) shares jumped 5.7% after the ailing
smartphone company and named a new chief financial officer.
Wells Fargo & Co.(WFC) shares rose 0.5%. The embattled
banking giant said late Tuesday that the company's head of
community banking, Carrie Tolstedt, has left the company
(http://www.marketwatch.com/story/wells-fargo-executive-departs-as-probe-into-scandal-launches-2016-09-27).
At the same time, CEO John Stumpf has recused himself from a probe
and agreed to forfeit outstanding equity awards worth about $41
million. Wells Fargo, rocked by a scandal involving employees
opening accounts without customers' knowledge, also said
independent directors and a law firm are investigating its
practices.
--Victor Reklaitis and Anora Mahmudova contributed to this
article.
(END) Dow Jones Newswires
September 28, 2016 16:29 ET (20:29 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.