Stocks, energy shares, oil jump after US strikes Venezuela

By Caroline Valetkevitch

NEW YORK, Jan 5 (Reuters) - Major stock indexes and oil prices gained on Monday, with energy shares climbing and investors reacting mostly calmly to potential market ramifications after a U.S. military strike that captured Venezuelan President Nicolas Maduro.

The Dow Jones Industrial Average hit a record high. The S&P 500 energy index rose to its highest since March 2025, with shares of Exxon Mobil up 2.2% and Chevron up 5.1%. Financial shares also rose, while an S&P index of defense shares was up more than 1%.

After the dramatic events in Venezuela at the weekend, U.S. President Donald Trump said he was putting the South American nation under temporary American control and that he could order another strike if Venezuela did not cooperate with U.S. efforts to open up its oil industry and stop drug trafficking. He also threatened military action in Colombia and Mexico.

Trump is planning to meet with executives from U.S. oil companies later this week to discuss boosting Venezuelan oil production, Reuters reported, citing a source familiar with the matter.

Oil prices were also higher as traders assessed the possible impact on crude flows from Venezuela, home of the biggest global oil reserves.

"It's a reasonable reaction from the markets to largely ignore the geopolitics around Venezuela, with the exception of a handful of oil companies, which are spiking," said Oliver Pursche, senior vice president, advisor at Wealthspire Advisors in Westport, Connecticut.

"Venezuela's GDP has virtually no impact on global GDP... so the market should ignore it," he said, noting that U.S. economic data this week will be key to the outlook for interest rates.

The Dow Jones Industrial Average rose 594.79 points, or 1.23%, to 48,977.18, the S&P 500 rose 43.58 points, or 0.64%, to 6,902.05 and the Nasdaq Composite rose 160.19 points, or 0.69%, to 23,395.82.

MSCI's gauge of stocks across the globe rose 8.38 points, or 0.82%, to 1,028.02.

The pan-European STOXX 600 index rose 0.94%. Emerging market stocks rose 21.63 points, or 1.51%, to 1,451.11. 

Brent crude futures rose $1.01 to settle at $61.76 a barrel, while U.S. West Texas Intermediate crude gained $1 to settle at $58.32.

US MILITARY ACTION SPURS SAFE-HAVEN DEMAND

Gold rose to a one-week high on bullion's safe-haven appeal. 

Spot gold hit its highest level since December 29. U.S. gold futures for February delivery gained 2.8% to settle at $4,451.5 an ounce.

The dollar index was down slightly after hitting a near-four-week high against a range of currencies following a weak December, with traders focused on this week's raft of key economic data and largely shrugging off events in Venezuela.

The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, fell 0.24% to 98.32.

Traders readied for new data that should offer fresh clues on the state of the U.S. economy and the likely path of Federal Reserve policy, culminating in the release of the jobs report for December on Friday.

U.S. Treasury yields eased. The yield on benchmark U.S. 10-year notes fell 2.4 basis points to 4.165%, from 4.189% late on Friday.

(Reporting by Caroline Valetkevitch in New York; Additional reporting by Lawrence White in London; Editing by David Goodman, Chizu Nomiyama and Jamie Freed)