U.S. Stocks Add to Rally as Crude Oil Advances; Dollar Climbs

(Bloomberg) -- The S&P 500 extended its rally to the longest since June 2014 as benchmark indexes added to all-time highs, with health-care shares and consumer staples taking a turn pacing gains. Oil powered above $51 a barrel on signs producers are following through with agreed production cuts.

The post-election rally in American equities plowed ahead even as the Federal Reserve looks certain to raise interest rates next week. Makers of household products led gains Friday after lagging behind for much of the post-election rally that’s added more than $1 trillion to the value of U.S. equities. Bank shares pushed gains in the past month to 18 percent.U.S. crude rose before OPEC meets in Vienna with non-member representatives. The dollar headed toward an 18-month high, supported by wagers on higher rates.

Speculation that Donald Trump’s policies will boost the economy enough to withstand the effects of higher interest rates lifted consumer confidence to the most in almost two years. At the same time, the European Central Bank’s pledge to expand its limits on asset purchases to include shorter-dated securities is expected to drive down borrowing costs for banks even though the central bank has announced it will curtail monthly additions after March, and is being interpreted as a buy signal in many quarters of the financial markets.

Stocks

• The S&P 500 rose 0.4 percent to 2,255.31 at 4 p.m. in New York, to cap a 3 percent rally in the week. The gauge closed at a record and is up 5.3 percent since the Nov. 8 election.
• The Dow Jones Industrial Average jumped 131.61 points to a record 19,746.42, concluding a weekly gain of 3 percent. Goldman Sachs Group Inc. pushed its gain since the Nov. 8 election to 33 percent.
• The Stoxx Europe 600 Index climbed 1 percent, for its best week since January 2015. Drugmakers, media and real estate companies were the best performers.
• Emerging-market equities fell 0.3 percent to pare a weekly gain to 2.7 percent, the most since September.

Commodities

• West Texas Intermediate crude advanced 1.3 percent to settle at $51.50 a barrel, the highest close since Monday.
• Saudi Arabia was said to have informed its customers it will stand by its commitment to cut production before OPEC meets with producers from outside the group to discuss reductions.
• Gold futures closed at the lowest level since February as the Federal Reserve gears up to raise rates. The metal lost 0.9 percent to settle at $1,161.90 an ounce.
• Copper and zinc both gained.

Currencies

• The dollar advanced 0.6 percent to $1.0557 per euro, having jumped 1.3 percent on Thursday.
• The Bloomberg Dollar Spot Index, which tracks the greenback against 10 major peers, rose 0.5 percent to finish the week higher.
• Investors see a 100 percent probability of an increase in U.S. interest rates on Dec. 14, according to pricing in federal funds futures contracts.

Bonds

• U.K. government bonds slid, with the 10-year gilt yield jumping three basis points to 1.41 percent after the Bank of England said U.K. consumers’ inflation expectations jumped to the highest in more than two years.
• Treasuries with a similar due date extended their fifth weekly drop, with the yield rising nine basis points in the period to 2.47 percent.

To contact the reporter on this story: Jeremy Herron in New York at jherron8@bloomberg.net. To contact the editors responsible for this story: Cecile Gutscher at cgutscher@bloomberg.net, Jeremy Herron