The S&P 500 (^GSPC) rose 0.41%, or 11.8 points, as of market close, with the energy sector leading advances. The Dow (^DJI) increased 0.39%, or 101.94 points, while the Nasdaq (^IXIC) advanced 0.57%, or 44.41 points.
U.S. oil futures rallied off Wednesday’s five-month lows following reports that two vessels near Iran came under suspected attack. The incident took place near the Strait of Hormuz, an important cargo passage in the Middle East. The two ships were carrying crude oil products en route to Asia.
On Thursday, U.S. Secretary of State Mike Pompeo told reporters in Washington it was, “the assessment of the United States government that the Islamic Republic of Iran is responsible for the attacks that occurred in Gulf of Oman today.”
“This assessment is based on intelligence, the weapons used, the level fo expertise needed to execute the operation, recent similar Iranian attacks on shipping and the fact that no proxy group operating in the area has the resources and proficiency to act with such a high degree of sophistication,” Pompeo said.
The latest incident comes after assaults on tankers off the coast of the United Arab Emirates last month. The U.S. placed blame on Iran for last month’s attack, which Tehran has denied.
U.S. crude oil futures (CL=F) rose as much as 4.5% during Thursday’s session before paring gains and settling at $52.28 per barrel. Brent crude oil prices (BZ=F) settled higher by more than 2% to $61.31 per barrel.
Earlier this week, oil prices plunged after the U.S. Energy Information Administration reported an unexpected build in domestic stockpiles and dwindling demand.
Other geopolitical concerns continued to weigh on global markets. Overseas, Hong Kong’s Hang Seng Index (^HSI) slipped slightly as of market close in Asia on Thursday, extending declines after protests over a proposed extradition bill erupted into violence Wednesday.
The ongoing tensions between opponents of the legislation and lawmakers spurred a second straight day of delays on debate of the bill, which would have far-reaching implications for the future relationship between Hong Kong and mainland China.
In more positive news for the region, Chinese e-commerce giant Alibaba (NYSE:BABA) (BABA) reportedly filed confidentially for a public listing in Hong Kong, according to Bloomberg, citing unnamed people familiar with the matter. The offering could raise as much as $20 billion and would create a second massive market for Alibaba shares, which have more than doubled since their U.S. public listing in 2014. The company at the time raised $25 billion from its New York initial public offering in what remains the world’s largest IPO.
ECONOMY
New U.S. jobless claims unexpectedly rose last week, the Bureau of Labor Statistics reported Thursday. Initial unemployment claims rose by a seasonally adjusted 222,000 for the week ending June 8, while consensus economists were expecting these to increase by just 215,000. The number of new jobless claims for the week prior was upwardly revised by 1,000 to 219,000.
Continuing unemployment claims also unexpectedly rose to 1.695 million for the week ending June 1, from an upwardly revised 1.693 million the week prior. Consensus economists were expected a decline to 1.660 million continuing claims.
Separately, import prices in May declined on a monthly basis for the first time since December, the BLS reported Thursday. On a monthly basis, import prices fell 0.3%, following a downwardly revised 0.1% increase in April. This was below the 0.2% decline anticipated. On a yearly basis, import prices fell 1.5%, or greater than the 1.2% decline expected. Excluding fuel prices, import prices also fell 0.3% month-over-month, following an upwardly revised 0.5% decline the month prior.
Export prices fell 0.2% in May, matching expectations. This followed a 0.1% monthly increase in April. On a yearly basis, export prices fell 0.7%, after a 0.2% increase the month prior.
The United States Oil Fund (NYSE:USO) LP (USO) . Year-to-date, USO has declined -9.41%, versus a 8.95% rise in the benchmark S&P 500 index during the same period.
USO currently has an ETF Daily News SMART Grade of A (Strong Buy), and is ranked #1 of 109 ETFs in the Commodity ETFs category.