Early stock rally fades; oil jumps above $33 a barrel

January 28 23:40 2016

An early stock rally faded Thursday as concerns about future Fed rate hikes, China’s economy and volatile oil prices continue to weigh on investor sentiment. Stocks originally jumped at the open as oil prices moved higher again and some strong corporate earnings reports provided a boost. But the gains quickly evaporated. The Dow Jones industrial average was down about 25 points, or 0.2%, in morning trading after being up as much about 140 points earlier. The Standard & Poor’s 500 index fell 0.1% and the tech-heavy Nasdaq composite was up 0.1%.Traders work on the floor of the New York Stock Exchange

The one consistent pattern this year in stocks is volatility with the Dow closing higher or lower by more then 200 points in the past four trading sessions and 11 of the 17 sessions this year. Stocks were unable to gain traction even as oil prices climbed for a third straight day. U.S. benchmark crude was up almost 4% to $33.51 a barrel after rising as high as $34.82.

Strong corporate earnings reports from Facebook (FB), Ford (F), Alibaba (BABA) and Caterpillar (CAT) were not enough to keep the indexes higher. Facebook shares surged more than 12% after easily beating Wall Street estimates. Weighing on markets was weak manufacturing report as durable goods orders tumbled 5.1% in December.

Overseas, Asian markets were mostly lower as the Shanghai composite index in mainland China lost 2.9%. Japan’s benchmark Nikkei 225 index fell 0.7%. European shares were lower as Germany’s DAX index tumbled 1.1% and France’s CAC 40 down 0.6%. All three major U.S. stock indexes closed lower on Wednesday amid a cautious assessment from the Federal Reserve about the global economy.