NEWS
01/03/2017 05:08 EST | Updated 01/04/2018 00:12 EST

US stocks ring in 2017 with gains as energy companies rise

NEW YORK — U.S. stock indexes are jumping at the start of the first trading day of 2017. Energy companies are climbing with the price of oil, while banks are advancing thanks to a bump in interest rates. Those two sectors were the best-performing parts of the market in 2016.

KEEPING SCORE: The Dow Jones industrial average leaped 122 points, or 0.6 per cent, to 19,884 as of 10 a.m. Eastern time. The Standard & Poor's 500 index rose 15 points, or 0.7 per cent, to 2,253. The Nasdaq composite added 38 points, or 0.7 per cent, to 5,420. The Russell 2000 index, which is made up of small-company stocks, jumped 9 points, or 0.7 per cent, to 1,366. The Russell rose almost 20 per cent last year and did far better than indexes focused on larger companies. U.S. stocks are coming off a three-day losing streak.

OIL: Benchmark U.S. crude gained $1.33, or 2.5 per cent, to $55.05 a barrel in New York. Brent crude, used to price international oils, rose $1.37, or 2.4 per cent, to $58.19 a barrel in London. That sent energy companies higher. Marathon Petroleum surged $2.74, or 5.4 per cent, to $53.09 and Halliburton added $1.82, or 3.4 per cent, to $55.91. Natural gas futures dropped 7.5 per cent.

BONDS: Bond prices fell. The yield on the 10-year Treasury note rose to 2.50 per cent from 2.43 per cent late Friday. Higher bond yields are linked to higher interest rates, and bank stocks made big gains. Citigroup rose 96 cents, or 1.6 per cent, to $60.39 and Morgan Stanley picked up 78 cents, or 1.9 per cent, to $43.04. Banks and energy companies both climbed more than 20 per cent last year.

Utilities, real estate investment trusts and companies that make and sell household goods traded lower. Those stocks are often compared to bonds because they pay large dividends, but the jump in yields Tuesday encouraged investors to look elsewhere.

COPY THAT: Xerox surged 78 cents, or 14 per cent, to $6.52 after it said it split itself in two, a move the company announced almost a year ago. The original Xerox kept its printer and copier business. The second company will focus on business process outsourcing, providing payment processing and other services. Xerox will receive $1.8 billion in cash.

The new company, Conduent Inc., now trades under the ticker symbol "CNDT." That stock lost 93 cents, or 7 per cent, to $13.92 in early trading.

CURRENCIES: The dollar jumped to 118.12 yen from 116.78 yen. The euro slumped to $1.0403 from $1.0531.

OVERSEAS: The FTSE 100 index in Britain rose 0.7 per cent and the French CAC 40 added 0.5 per cent. Germany's DAX inched up 0.1 per cent. Hong Kong's Hang Seng index gained 0.7 per cent and the Kospi in South Korea rose 0.9 per cent. Tokyo's stock market remained closed for the New Year's holiday.

___

AP Markets Writer Marley Jay can be reached at http://twitter.com/MarleyJayAP His work can be found at http://bigstory.ap.org/journalist/marley-jay