[New York Stock Market Briefing] Investor sentiment stays firm despite U.S. strikes on Venezuela… all three major indexes 'rise'

Major indexes on the New York stock market in the United States rose across the board. Although a geopolitical crisis emerged, including the U.S. invasion of Venezuela, the market appeared busy searching for beneficiaries.

On the 5th (local time) at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average closed at 48,977.18, up 594.79 points (1.23%) from the previous session. The Standard & Poor’s (S&P) 500 gained 43.58 points (0.64%) to 6,902.05, and the Nasdaq rose 160.19 points (0.69%) to finish at 23,395.82.

The Dow notched a new all-time intraday high and also ended at a record closing level.

By sector, financials and energy climbed more than 2%, while consumer discretionary, materials, and industrials also jumped over 1%. Utilities fell 1.16%.

Markets turned their attention to related stocks after the U.S. said it had arrested Venezuelan President Nicolás Maduro and would step in to help rebuild Venezuela’s oil industry. Estimates are emerging that restoring Venezuela’s oil infrastructure could cost about $100 billion over the next decade.

Shares of Chevron—among major U.S. refiners, the only one still operating in Venezuela—jumped 5.1%, drawing attention. Exxon Mobil rose 2.21%, and ConocoPhillips gained 2.59%.

Oilfield services and equipment makers also drew strong interest. Within the oil equipment and services index, Schlumberger—the largest by market capitalization—surged 8.96%, while Baker Hughes rose 4.09%. Halliburton also leapt 7.84%.

Valero Energy also soared 9.23%. Valero is based along the U.S. Gulf Coast and is regarded as almost uniquely capable of processing large volumes of heavy crude and sour crude (high-sulfur crude).

Defense stocks also strengthened after U.S. President Donald Trump warned that he could topple regimes in Iran, Cuba, and Colombia following Venezuela. Lockheed Martin rose 2.92%.

Sam Stovall, chief investment strategist at CFRA Research, said, "In the short term, oil prices could rise due to uncertainty over oil supply and transport," but added, "Over the long term, as conditions have steadily worsened over the past few years, U.S. intervention could instead lead to positive outcomes."

Bank stocks also advanced on expectations of indirect benefits from the collapse of the Maduro regime. JPMorgan rose 2.63%, Bank of America gained 1.68%, Morgan Stanley added 2.55%, and Goldman Sachs climbed 3.73%.

Venezuela has been in default on more than $60 billion in external debt since 2017. If U.S.-Venezuela relations normalize after Maduro’s ouster, the likelihood increases that restructuring will begin in earnest for Venezuelan sovereign bonds and debt issued by the state-owned oil company Petróleos de Venezuela, S.A. (PDVSA). In this process, investment banks are expected to benefit from large advisory fees and brokerage revenues.

Among mega-cap tech companies with market capitalizations above $1 trillion, Amazon and Tesla rose around 3%. By contrast, Apple, Nvidia, Broadcom, and Microsoft fell about 1%.

The U.S. manufacturing activity index remained in contraction for the 10th consecutive month. The Institute for Supply Management (ISM) reported that the December manufacturing purchasing managers’ index (PMI) came in at 47.9, down 0.3 points from 48.2 in November.

According to the CME FedWatch Tool, the federal funds rate futures market priced in an 83.9% probability that rates will be held steady in January, little changed from around the prior close.

The Cboe Volatility Index (VIX) rose 0.39 points (2.69%) from the previous session to 14.90.

Jin Young-gi, Hankyung.com reporter young71@hankyung.com