Stocks were mixed Wednesday morning as crude oil jumped following reports of an OPEC agreement to cut oil production.
The S&P 500 and Dow Jones industrial average hit record highs intraday and were trading up 0.2% and 0.4%, respectively. The tech-heavy Nasdaq turned negative and fell more than 0.3%.
Leading the blue chip index were Chevron (CVX) and Goldman Sachs (GS), which moved up about 2% and 4%, respectively. Goldman Sachs was upgraded to buy from hold by Deutsche Bank. On the downside, Verizon (VZN) and Wal-Mart (WMT) both fell less than 1%.
The big winners in the stock market today were oil and gas stocks as they migrated to the top of the S&P 500 performance. Devon Energy (DVN) and Marathon Oil (MRO) headed up the S&P 500, rising 12% and 16%, respectively.
F5 Networks (FFIV) fell nearly 2% after a downgrade from Bernstein. The analyst cut the IBD 50 member to market perform from outperform, citing "limited valuation left as product cycle accelerates." The stock is 11% above its 126.07 double-bottom buy point and has been up six weeks in a row, a sign of institutional accumulation.
American Eagle, Autodesk Tumble
American Eagle (AEO), the apparel retailer, beat Q3 earnings and sales estimates; however, its downbeat Q4 EPS guidance caused a 13% decline today. The stock recently broke out of a cup with handle base, but that breakout has now failed. The Relative Price Strength Rating was weak throughout the base.
Autodesk (ADSK) slid 5% following its Q3 earnings report after the close yesterday. The company reported strong Q3 results, but guided its Q4 outlook below Street expectations. Shares hit a new 52-week high two weeks ago.
OPEC Cuts Production, Oil Soars
Oil prices soared 7% after OPEC reached an agreement to cut production by 1.2 million barrels per day, according to reports. Some details still remain unclear, such as which countries will cut and by how much. The dollar rallied 0.6% following a three-day losing streak.
ADP reported November private payrolls increased 216,000, which was better than the expected 160,000. The goods producing sector lost 11,000 jobs, while the service sector gained 228,000.
Personal income came in at 0.6% in October, above the 0.4% estimate. October consumer spending rose 0.3% missing the 0.5% estimate.
Dallas Federal Reserve President Robert Kaplan advocated for rate hikes given the economy's progress toward the Fed's goals on jobs and inflation.
November Chicago Purchasing Managers' Index printed a 57.6 vs. the 52.0 estimate, which is its highest reading since January 2015.
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