The downtrodden energy and materials sectors, two of last year’s worst-performing groups, led U.S. stocks higher Monday, helping extend the S&P 500’s five-day gain to over 4%. Oil prices surged more than 5%, helping the Dow Jones Industrial Average to a gain of 1.4% as nearly all 30 of the blue-chip index’s components closed higher.
Chevron Corp (NYSE:CVX), the second-largest U.S. oil company, led the Dow higher with a gain of nearly 3% while the Nasdaq Composite jumped 1.5%.
Market participants are still waiting on confirmation of production freeze from the Organization of Petroleum Exporting Countries (OPEC) and other major oil-producing nations, which could could help further support oil prices. OPEC members Saudi Arabia, Iran and Iraq are expected to announce production caps as soon as early March, but those caps will come at near-record output levels.
Good news from the commodities complex helped lift two of today’s best-performing stocks, Freeport-McMoRan Inc (NYSE:FCX), Vale SA (ADR) (NYSE:VALE), while cyber security giant FireEye Inc (NASDAQ:FEYE) ranked among the day’s technology leaders.
Freeport-McMoRan Inc (FCX)
Shares of copper miner Freeport-McMoRan soared 14.5% on volume that was about 9% above the daily average after a media report suggested that Anglo-Australian mining giant BHP Billiton Limited (ADR) (BHP) should acquire Freeport. The report highlights the fact that both embattled companies are engaged in metals mining as well as oil exploration and production, indicating there are potential synergies between the firms.
Still, any talk of a marriage between the two companies is pure speculation at this point. As for Freeport, the shares are likely to continue taking cues from the commodities patch. The stock has about doubled over the past month, but it still down nearly 64% over the past year.
Vale SA (ADR) (VALE)
Shares of Brazil’s Vale, the world’s largest iron ore producer, climbed over 13% on volume that was almost 50% above the daily average on news that iron demand in China is showing signs of firming. China, the world’s second-largest economy, is the largest consumer of iron ore and one of Brazil’s most important trading partners.
Also lifting Vale and other Brazilian stocks was news of increased corruption raids in Latin America’s largest economy. Brazilian President Dilma Rousseff has come under fire for corruption at some of Brazil’s largest companies. Monday’s corruption raids focused on one of the architects of Rousseff’s and her predecessor’s presidential campaigns.
FireEye Inc (FEYE)
Shares of cyber security firm FireEye jumped 9.4% on volume that was almost 31% above the daily average after a financial analytics firm named the stock one of its top picks in the cyber security space while noting that cyber security spending is forecast to rise six-fold by 2020.
FireEye’s Monday pop brings its one-month gain to about 3% while trimming its year-to-date loss to about 26%.
As of this writing, Todd Shriber did not hold a position in any of the aforementioned securities.
