Stocks seesaw higher as oil rebounds
Ahead of Wednesday's expected Fed hike, stocks climbed as oil prices, which hit multi-year lows recently, found a floor.
The Dow Jones industrial average ended up 103 points, a 0.6% gain. The S&P 500 climbed 0.5% and the Nasdaq composite gained 0.4%. A massive junk bond selloff continues, with ETFs associated with the high yield, high risk investments, HYG and JNK, down 0.8% each.
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Elsewhere, Tokyo's Nikkei 225 index plunged 1.8%. China's Shanghai composite index rose 2.5%. Key European indexes ended sharply lower, with Britain's FTSE 100 losing 1.3% and the DAX of Germany falling 2%, a 201-point loss.
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Oil sold on U.S. markets is about a quarter above $36 a barrel, up 1.7%, after futures slipped to below $35 a barrel earlier in the day. In recent days the prices for oil in the U.S. and for Brent crude, from the North Sea, have hit six- and seven-year lows, respectively.
Amid the backdrop of falling oil, Shell says it is cutting 2,800 jobs in a pre-planned administrative move. The oil giant says in a release Monday that the job cuts, amounting to 3% of its workforce, come as the company finalizes its takeover of British-based BG Group.
The Federal Reserve will announce on Wednesday whether to raise its benchmark rate that has been held near zero since the global financial crisis in 2008.
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Investors and analysts expect a modest increase of 0.25 percentage points and Fed chief Janet Yellen has said that any increase would be gradual.
Exceptionally low interest rates have helped lift stock prices. The Fed last raised rates in 2006. They have been stuck at near zero ever since for fear of upsetting a fragile economic recovery
"Markets are taking a bumpy route to the most awaited event of the year," Citigroup said in a note to analysts.
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The European Central Bank earlier this month cut interest rates to 10 basis points to minus 0.3%.
Last week, the Dow ended down 3.3% and the price of oil sold off sharply amid market jitters over the potential impact of the Fed's expected move.
Kim Hjelmgaard on Twitter: @khjelmgaard.
Ed Brackett on Twitter: @BrackSnacks.
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