Financial Shares Drive U.S. Stocks Higher

By Jon Sindreu and Aaron Kuriloff Features Dow Jones Newswires

U.S. stocks snapped a two-session losing streak as gains in financial shares boosted major indexes Wednesday.

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Stocks had edged lower in recent sessions, but some analysts and investors said signs of improvement in the global economy and corporate earnings will likely continue to support markets.

"As long as earnings are strong and the economic backdrop good, I'm still cautiously optimistic," said Susan Bao, portfolio manager at J.P. Morgan Asset Management.

The Dow Jones Industrial Average rose 37 points, or 0.2%, to 21174. The S&P 500 added 0.2% and the Nasdaq Composite gained 0.4%.

Financial stocks rebounded after Tuesday's declines, with exchange operators among Wednesday's biggest gainers. Intercontinental Exchange rose 3.4%, CME Group gained 2.5% and CBOE Holdings added 2.4%. Nasdaq rose 2%. The financial sector led gains in the S&P 500, rising 0.8%.

Shares of financial companies have recently moved in tandem with longer-term U.S. government bond yields. The yield on the benchmark 10-year U.S. Treasury rose to 2.180% Wednesday from 2.147% Tuesday, which was its lowest close since Nov. 10. Yields rise as prices fall.

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Energy companies in the S&P 500 fell 1.5% as the price of oil slumped. U.S. crude for July delivery lost 5.1% to $45.72 a barrel after the U.S. Energy Information Administration reported that oil stockpiles rose for the first time in nine weeks. Gasoline inventories also rose, raising fears that U.S. drivers won't use up the glut of crude and fuel over the summer.

Investors were also looking ahead to a series of scheduled events Thursday, including a policy decision from the European Central Bank. Former U.S. Federal Bureau of Investigation director James Comey is expected to testify in Washington, after his prepared remarks were released Wednesday. Early results for the U.K. general election will also start coming in, with the latest polls suggesting a tighter race than originally anticipated.

The Stoxx Europe 600 slipped less than 0.1% as shares of oil and gas companies fell. Banco Santander shares lost 0.9% in Madrid after it announced the takeover of Spanish rival Banco Popular Español, which the ECB had deemed "likely to fail" earlier Wednesday.

In Asia, Japan's Nikkei Stock Average and Australia's S&P/ASX 200 were both little changed, while Korea's Kospi lost 0.4%. The Shanghai Composite Index added 1.2%.

Write to Jon Sindreu at jon.sindreu@wsj.com and Aaron Kuriloff at aaron.kuriloff@wsj.com

(END) Dow Jones Newswires

June 07, 2017 16:27 ET (20:27 GMT)