Stocks end volatile first day of 2019 with small gains

U.S. stocks ended a volatile first session of 2019 with small gains as energy companies Wednesday helped boost major averages.

When the session began the Dow Jones Industrial Average plunged nearly 400 points on weaker-than-expected Chinese economic data. Investors worried that such data could get worse if a trade deal with the U.S. isn’t reached soon.

The Chinese data showed the nation's economy last month contracting for the first time in over two years, highlighting the challenges facing Beijing as it seeks to end a bruising trade war with Washington and reduce the risk of a sharper economic slowdown in 2019.

Concerns about the health of China’s economy hammered Asian and European stocks, which also contributed to the downdraft on American exchanges.

Ticker Security Last Change Change %
I:DJI DOW JONES AVERAGES 35950.89 +520.47 +1.47%
SP500 S&P 500 4567.8 +17.22 +0.38%
I:COMP NASDAQ COMPOSITE INDEX 14226.218266 -32.27 -0.23%

Further, there were worries about the partial U.S. government shutdown – now in its 12th day – and how businesses could be affected if the standoff between President Trump and Congress continues.

In addition, prospects for the more interest rate hikes this year weighed on sentiment.

But then oil prices spiked on a report that crude exports from Saudi Arabia fell last month on lower U.S. production. The news came as output cuts of 1.2 million barrels per day by Saudi Arabia, Russia and others come into play. Oil, which was down as much as 2.3 percent earlier, surged almost 5 percent.

As a result, shares of oil companies, both those with heavy investments in exploration and production and those with a focus on refining and marketing, jumped.

Ticker Security Last Change Change %
XOM EXXON MOBIL CORP. 102.80 +0.46 +0.45%
CVX CHEVRON CORP. 143.60 -0.31 -0.22%
PSX PHILLIPS 66 128.87 +6.72 +5.50%
MPC MARATHON PETROLEUM CORP. 149.21 +1.81 +1.23%

Shares of tech and financial companies soon followed suit and for much of the afternoon the major averages moved in and out of positive territory. By the session's conclusion all three averages finished higher.

The Dow and S&P 500 have now posted gains in four of the last five trading days.

The Nasdaq has climbed in the last five sessions, and it has posted its largest five-day percentage gain since Oct. 10, 2011.

Meantime, the yield on 10-year Treasurys fell to a 12-month low, dropping to 2.67 percent in a measure of investors’ rush to what are perceived as safe investments.

Gold, sometimes seen as a safe investment, hit a six-month high Wednesday of $1,287.30 per ounce.

China’s Shanghai Composite started the new year with a decline of 1.1 percent.

Hong Kong’s hang Seng plunged 2.8 percent.

Japan's Nikkei was closed for a holiday.

In European trading, London’s FTSE fell 0.8 percent, Germany’s DAX declined 0.5 percent and France’s CAC was off 1.5 percent.

U.S. Federal Reserve Chairman Jerome Powell will have the chance to comment on the economic outlook when he participates in a joint discussion with former Fed chairs Janet Yellen and Ben Bernanke on Friday.

Also looming are a closely-watched survey on U.S. manufacturing due on Thursday, followed by the December payrolls report on Friday.

The 30-stock Dow ended 2018 down 8.66 percent, its largest one-month percentage decline since February 2009 and its worst December since 1931.

The S&P 500 finished last year down 9.18 percent, also its largest one-month percentage decline since February 2009 and its worst December since 1931.

The Nasdaq ended the year 9.48 percent lower. The tech-heavy index posted its worst December results since 2002.

FOX Business’ Ken Martin contributed to this article.