By Caroline Valetkevitch
NEW YORK (Reuters) – Oil prices rose more than 5% on Thursday after Washington imposed sanctions on major Russian companies over the Ukraine war, while major stock indexes rose as gains in U.S. and European energy stocks helped offset some lackluster earnings news.
The sanctions, announced late Wednesday, were imposed on major Russian suppliers Rosneft and Lukoil. European Union countries also approved a 19th sanctions package against Moscow that included a ban on Russian imports of liquefied natural gas, while Britain slapped sanctions on Rosneft and Lukoil last week.
Wall Street stocks rose, and indices gained momentum after the White House confirmed that US President Donald Trump will meet with Chinese President Xi Jinping next week as part of his Asia trip.
Energy led sector gains in the S&P 500 index, last rising 1.6%.
A series of positive earnings reports also helped support the stock. Honeywell shares gained 7.6% after the company raised its 2025 profit forecast. However, some pressure came on the market when International Business Machines shares fell 1.2% after the company reported a slowdown in growth in its key cloud software segment.
“Overall, the (stock) market is responding to the earnings, which for the most part are still good. And the other factor is that Trump imposed severe sanctions on major Russian oil companies, which is being applauded by the market. You can see that in the energy sector,” said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.
The Dow Jones Industrial Average rose 185.84 points, or 0.39%, to 46,774.16, the S&P 500 rose 47.28 points, or 0.70%, to 6,746.56 and the Nasdaq Composite rose 239.21 points, or 1.05%, to 22,979.60.
MSCI’s gauge of global stocks rose 5.10 points, or 0.51%, to 995.87.
The STOXX 600 index closed at a record high, led by gains in energy stocks. The pan-European STOXX 600 index rose 0.37% to 574.43 points. Also helping sentiment was Kering shares rose 8.7% after the Gucci owner said sales in the previous quarter fell less than analysts expected.
Chinese stocks closed up 0.3%, recovering from a 1.1% drop after sources said the White House was considering a plan to curb a series of software exports to China in retaliation against Beijing’s latest round of restrictions on rare earth exports.
Oil futures were in focus following the latest news about sanctions on Russia. The United States said it was prepared to take further action and called on Moscow to immediately agree to a ceasefire in Ukraine. US crude oil gained 5.6% to settle at $61.79 a barrel. Brent was trading at $65.93, with a latest rise of 5.34%.