U.S. stocks jumped Friday, ending a five-day slide as oil rebounded with its best day in seven years. An encouraging report on retail sales also helped lift the stock market to its first gain since late last week.
The Dow Jones industrial average rose 313.66 points, or 2 percent, to 15,973.84.
Despite the rally, the major U.S. stock indexes ended the week down about 1 percent, and they remain down more than 8 percent for the year.
"It's a relief to see after several very ugly days in a row, but I wouldn't hang my hat on it and say the worst is over," said Rob Eschweiler, global investment specialist at JPMorgan.
A surge in oil prices helped put investors in a buying mood early on. A day after sinking to its lowest level since May 2003, benchmark U.S. crude climbed $3.23, or 12.3 percent, to close at $29.44 a barrel in New York. Brent crude, a benchmark for international oils, rose 11 percent to $33.36 a barrel in London.
"This is really a classic price action where you make a new low and then rebound strongly," said Kyle Cooper, director of research with IAF Advisors and Cypress Energy Capital Management in Houston.
Traders also may have been reacting to a report that members of OPEC are starting to consider a reduction in crude production. Producers are ready to work together and won't make cuts unless there's complete cooperation, United Arab Emirates Oil Minister Suhail Al Mazrouei said on a Sky News Arabia report posted online Wednesday.
Venezuela has lobbied exporters including Russia, Iran and Saudi Arabia to arrange a meeting of OPEC members and other suppliers in an attempt to reach an agreement to balance the market.
The oil rebound sent the S&P 500's energy companies 2.6 percent higher. Marathon Oil was the best performer in the sector, rising 48 cents, or 6.8 percent, to $7.49. Shares of El Dorado-based Murphy Oil Corp. rose 82 cents, or 5 percent, to close at $16.79.
"Oil, which has been one of the most fickle, most volatile series that everybody's watching, is having a nice day," said Tim Dreiling, regional investment director for The Private Client Reserve of U.S. Bank. "Europe is continuing to look good. And it looked like [the market] was oversold."
Global stocks have been in a slump since the beginning of the year on concerns that growth in China, which has been the engine of the global economy in recent years, is slowing far faster than expected. Plunging oil prices and low inflation have added to the market's jitters that the global economy is sputtering.
Those worries also helped drive the stock market lower in recent days.
"Most of the people out there feel like the downdraft isn't a big crash in the making, so everyone is looking for a time to buy," Phillip Titzer, who helps oversee about $1.4 billion as vice president of investment operations at Edgar Lomax Co. in Springfield, Va. "This might just be some investing of some cash with people thinking prices look good now. There isn't any huge development, but oil is up and so many times we see oil go up and stocks go up."
The downbeat trend in the U.S. snapped Friday with financial shares leading the market's advance in New York. The Standard & Poor's 500 gained 35.70 points, or 2 percent, to 1,864.78. The Nasdaq composite added 70.67 points, or 1.7 percent, to 4,337.51.
The financial sector is the worst-performing part of the market this year because investors expect that low interest rates around the world will sap bank profits, but it rallied 4 percent Friday.
JPMorgan Chase climbed $4.42, or 8.3 percent, to $57.49, while Citigroup added $2.56, or 7.3 percent, to $37.54. Bank of America rose 79 cents, or 7.1 percent, to $11.95. Meanwhile, Deutsche Bank AG surged 12.1 percent after the bank offered to buy back more than $5 billion in bonds in a display of financial strength. The stock gained $1.87 to $17.38.
Traders also welcomed a report from the Commerce Department indicating a modest gain in retail sales last month. The data, which came in ahead of expectations, suggested that consumers kept shopping despite sharp drops in stock prices.
The positive sales report and recent jobs data showing a pickup in wage growth suggest the economy is holding up better than Wall Street thinks, Eschweiler said.
"It solidifies our view that the markets are pricing in a significantly higher probability of recession than what we think the fundamentals currently dictate," he said.
Encouraging quarterly results from some companies also helped lift the market.
Wynn Resorts surged 15.8 percent after the casino operator reported better-than-expected quarterly results Thursday. The stock gained $9.45 to $69.14.
Groupon vaulted 29 percent after the online daily deal service's latest quarterly profit and revenue topped Wall Street estimates. The stock added 65 cents to $2.89.
Some companies didn't fare as well, however.
Activision Blizzard slid 7.9 percent after the video-game company reported weaker-than-anticipated quarterly revenue Thursday. The stock was one of the biggest decliners in the S&P 500 index, losing $2.40 to $28.12.
Pandora Media slumped 12 percent after the Internet radio company's fourth-quarter profit fell short of estimates and the company didn't comment on rumors that it's looking to sell itself. The stock lost $1.09 to $8.
In Europe, Germany's DAX was up 2.5 percent, while France's CAC 40 was up 2.5 percent. Britain's FTSE 100 rose 3.1 percent.
In Asia, Japan's main stock index fell sharply, leading other Asian markets lower. Tokyo's Nikkei 225 plunged 4.8 percent after earlier sinking as much as 5.3 percent. Hong Kong's Hang Seng fell 1.2 percent. South Korea's Kospi gave up 1.4 percent and Australia's S&P/ASX 200 fell 1.2 percent. Shares in New Zealand and Southeast Asia also fell. Markets in China and Taiwan were closed all week for the Lunar New Year holidays and will reopen Monday.
A day after surging 4.5 percent, gold fell $8.40, or 0.7 percent, to $1,239.40 an ounce. Silver was flat at $15.79 an ounce. Copper, an industrial metal that often will rise and fall along with investors' optimism about the global economy, rose 2 cents, or 1.1 percent, to $2.03 a pound.
Bond prices fell. The yield on the 10-year Treasury note rose to 1.74 percent from 1.66 percent late Thursday.
Information for this article was contributed by Jeremy Herron, Dani Burger, Mark Shenk and Jonathan Burgos of Bloomberg News and by Alex Veiga of The Associated Press.
Business on 02/13/2016