The Dow Jones Industrial Average ended higher Thursday even as reports of attacks on two oil tankers sent oil prices soaring. Lululemon Athletica (LULU – Get Report) jumped after topping first-quarter earnings and sales forecasts and lifting its fiscal-year outlook. Lululemon Athletica is Real Money’s Stock of the Day.
Tyson Foods (TSN – Get Report) shares heated up after the meat and poultry producer said it was set to release its first set of plant-based protein meat-like products.
Wall Street Overview
Stocks came on strong late in the session and ended higher Thursday as oil prices climbed following reports of attacks on oil tankers in the Gulf of Oman.
The Dow Jones Industrial Average climbed 102 points, or 0.39%, to 26,107, the S&P 500 rose 0.41%, and the Nasdaq advanced 0.57%.
Secretary of State Mike Pompeo on Thursday afternoon directly blamed Iran for the attacks on the Kokuka Courageous and the Front Altair. Pompeo did not present any evidence to back up the assessment of Iran’s involvement.
“Iran is lashing out because the regime wants our successful maximum pressure campaign lifted,” Pompeo said. “No economic sanctions entitle the Islamic Republic to attack innocent civilians, disrupt global oil markets and engage in nuclear blackmail.”
Oil prices, which had
rebounded from five-month lows Thursday following the attacks, held steady after Pompeo’s comments. Brent crude contracts for August delivery were up $1.36 to $61.33 a barrel, while West Texas Intermediate contracts for July, which are more tightly linked to U.S. gas prices, were up $1.02 at $52.16 a barrel.
The Japanese owner of the Kokuka Courageous told CNN the 27,000-ton tanker had been attacked “by some sort of shell” off Fujairah, a port in the United Arab Emirates. The ship suffered damage to its starboard hull. A second tanker, the Front Altair, suffered a fire following an explosion while sailing in the Gulf of Oman, CNN reported. Washington accused Tehran of being behind a similar attack on four tankers in the same area last month.
The Dow was led higher by Walt Disney (
Get Report) , which rose 4.4% to $141.74 following
a bullish note from Morgan Stanley’s Benjamin Swinburne who believes the company’s direct to consumer Disney+ service will have better subscriber growth than previously expected.
Gains on Thursday were capped, however, as investors were still contending with concerns about the lack of a U.S.-China trade agreement.
“Nothing particularly new on the trade front besides more tough talk from Chinese leaders suggesting they won’t cave to U.S. pressure,” LPL Financial Research said in a newsletter. “Expectations for a breakthrough at the G-20 Summit later this month may have faded a bit, though indications that the two leaders will meet in Japan and President Trump’s refusal to set a hard deadline for new tariffs could be interpreted positively.”
Tyson Foods (
Get Report) shares rose slightly to $82.53
after the meat and poultry producer said it’s set to release its first plant-based protein meat-like products, making it the largest U.S. meat producer to date to enter the growing alternative protein segment. Shares of rival Beyond Meat (
BYND) ended down slightly to $141.39.
Alibaba Group (BABA – Get Report) rose slightly to $160.33 following multiple media reports that the online retailing giant has filed for a Hong Kong listing that could be worth as much as $20 billion.
In economic news, initial claims for state unemployment benefits rose 3,000 to a seasonally adjusted 222,000 for the week ended June 8, the Labor Department said. Data for the prior week was revised to show 1,000 more applications received than previously reported. Economists polled had forecast claims decreasing to 216,000 in the latest week.
“The jobless claims report came in at 222,000 which was slightly higher than the 216,000 that economists were expecting, and the previous reading of 218,000, was revised higher to 219,000,” David Madden, a market analyst at CMC Markets UK. “The announcement didn’t cause much of a stir given that the labor market is so strong. Monthly import and exports prices dropped by 0.3% and 0.2% respectively.
Madden said the slip in prices could be a sign that demand at home and abroad is falling.
“In light of all the talk about the (Federal Reserve) potentially cutting rates later this year,” he said, “even slightly negative economic reports could be viewed as a sign the US central bank is more likely to loosen monetary policy.”
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