Oil pushes Wall Street to new records

Oil pushes Wall Street to new records

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US exchanges ended with slight gains on Wednesday, reaching record highs after energy surge had offset losses in the technology sector. Apple was the biggest decliner for the day in the Dow Jones index, but that did not stop the index from closing at a record level of 22,158.18 points, with the Chevron oil company contributing the most. The oil giant benefited from higher oil prices.

Oil prices have been favorably influenced by the International Energy Agency’s report, which showed that global crude oil saturation is shrinking. Crude oil reserves in the United States increased by 5.9 million barrels in the past week with an estimated 3.2 million barrels expected by economists. The price of a Brent barrel rose 88 cents on Wednesday and reached 55.15 dollars. Earlier the price of 55 dollars was reached for the first time since April. The price of light crude oil WTI rose 2.2 percent to 49.29 dollars a barrel.

The energy sector was the best in the S & P 500, with a rise of more than a percentage point to lift the index up 0.1% to a record level of 2 498.37 points. Shares of energy companies were heavily aided by oil prices at a one-month high. The NASDAQ Composite index also ended the session in green territory, also marking a new record closing.

Although they traded at record levels, for most of the day, the three indices were in a neutral price range offsetting weakness in the past few days. Investor sentiment was further stimulated by U.S. Treasury Secretary Steven Mnuchin, who said the presidential administration would push its tax reform plan before 2018.

American Airlines lowered the sales forecast as a result of Hurricane Irma. The airline had to cancel about 5,000 flights. However, the stock was still up 1.5 per cent.

Warehouse chain Nordstrom increased 6 percent amid news that Nordstrom family members are reportedly working on a plan to take the department store private. Based on chatter, they are seeking $1 billion in equity from Leonard Green & Partners to help fund a buyout.

Western Digital dropped 3.4 percent due to spat over the acquisition of Toshiba’s chip division. Toshiba on Wednesday signed MOU with a Bain Capital-led consortium which reportedly include Apple, Seagate and Dell. The two parties have agreed to reach a definitive agreement in the current month. Financial details were not revealed but reports claim the sale price is at USD18 billion.

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Brayden Fortin is a American with numerous years of investment experience in the American Equity Market and in the Global Commodity Market. He has a B.Com degree from a well respected Canadian university and has experience working in the wealth management industry. He is interested in delving into numbers to analyze companies and markets. He won a couple of international strategy simulation competitions involving decision making through numerical analysis, and also scored in the top 50 on the Bloomberg Aptitude Test (out of nearly 200,000 test takers).

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