Stock Market News for June 3, 2010 - Market News

U.S. stocks erased Tuesday’s losses, helped by a rally in energy and financial shares, as a better-than-expected report on pending home sales and low valuations enticed investors. 

Government’s announcement of a civil and criminal investigation into the Gulf oil spill had sent major indexes sharply lower on Tuesday, with most of the losses coming shortly before the closing bell.  The selloff sent energy stocks sharply lower along with the broader market. 

However, Wednesday saw energy stocks leading the advance as traders picked up beaten-down shares from the sector.  Shares in Halliburton HAL jumped 12%, Schlumberger SLB rose almost 9% and Anadarko Petroleum APC added more than 5%.  Baker Hughes BHI advanced 10.5% and BP BP, after yesterday’s drubbing, tacked on 3%. However, Transocean, the operator of the ill-fated rig, dropped 3% after its 12% slide Tuesday.

The Dow Jones industrial average jumped 225 points, or 2.3%, its third largest gain of the year.  The tech-heavy Nasdaq surged 2.6% to close at 2,281 and the broader S&P500 index jumped 2.6% to close at 1,098.  On the New York Stock Exchange, five stocks fell in price for each one that rose.

Treasury prices were lower, sending the corresponding yield higher.  The yield on the benchmark 10-year note rose to 3.34% from 3.26% late Tuesday.

Some forex analysts, meanwhile, noted a counter-trend rally could be in the works, given the euro's stay near its $1.21 support level, with a weaker dollar brightening outlooks for large US multinationals as well as technology companies.

Yesterday, auto sales recorded their seventh straight month of gains, as cars and light truck sales jumped 19% in May to 1.1 million units, helped by increased purchases from rental-car firms.  Ford's F total sales jumped 22% and the company raised its second quarter production target slightly by 15,000 units to 640,000. GM's sales rose 17.5%, Chrysler's 32.7%, as Toyota's TM gained 6.7%.

Today, Fed speakers slated to take the podium include Fed Chairman Bernanke, Dennis Lockhart, Eric Rosengren and Thomas Hoening, with participants eager to know about plans for a less-accommodative Fed, as well as for the economy in terms of euro zone distress.