05 Dec 2018

Daily Market View

Daily Market View

Wednesday, December 05, 2018
          U.S Stock Market

 

DJIA S & P 500 NASDAQ
25046 2701.75 6802.50
-3.10% -3.24% -3.80%

U.S stocks plunged, with the Dow Jones Industrial Average tumbling almost 800 points, as a litany of concerns wiped out the rally in risk assets. Trade-sensitive shares sank as angst mounted that the U.S and China made no meaningful progress on the trade front this weekend. Financial shares got hammered as the yield curve continued to flatten, with the latest nudge from a hawkish comment by a Federal Reserve official. Losses accelerated and trading volumes in S&P 500 futures spiked after contracts for broke below their 200-day moving average. Adding to the risk aversion was news that U.K. Prime Minister Theresa May’s push to avoid a so-called “hard Brexit” may be at risk. President Donald Trump suggested Tuesday that he could extend a 90-day truce in his trade war with China, while his top White House economic adviser backtracked from the president’s announcement that Beijing had agreed to reduce tariffs on U.S.-made cars. Traders are even starting to bet that the Fed will cut interest rates as soon as 2020.

 

Major Economic Releases for Today
Period Event GMT Forecast Previous

nov

Nikkei Japan PMI Services 00:30 52.4

3Q

Australia Gross Domestic Product (YoY) 00:30 3.3% 3.4%

nov

Caixin China PMI Services 01:45 50.8 50.8

oct

Euro-Zone Retail Sales (YoY) 10:00 2.0% 0.8%

nov

U.S MBA Mortgage Applications 12:00 5.5%

nov

U.S ADP Employment Change 13:15 195k 227k

dec

Bank of Canada Rate Decision 15:00 1.75% 1.75%

nov

U.S ISM Non-Manufacturing/Services Composite 15:00 59 60.3

nov

DOE U.S Crude Oil Inventories 15:30 3577k
Dow Jones Industrial Average

The Dow Jones Industrial Average declined 3.10%. The best performers of the session on the Dow Jones Industrial Average were Procter & Gamble Company, which fell 0.01% or 0.01 points to trade at 93.31 at the close. Meanwhile, Verizon Communications Inc. fell 0.12% or 0.07 points to end at 58.09 and Johnson & Johnson was down 0.12% or 0.18 points to 146.03 in late trade. The worst performers of the session were Caterpillar Inc., which fell 6.93% or 9.63 points to trade at 129.32 at the close. Boeing Co declined 4.85% or 17.46 points to end at 342.50 and Intel Corporation was down 4.75% or 2.38 points to 47.75.

 

NASDAQ 100

The NASDAQ index lost 3.80%. The top performers on the NASDAQ Composite were Pernix Therapeutics Holdings Inc. which rose 41.63% to 0.575, American Electric Technologies Inc. which was up 37.96% to settle at 1.490 and Novelion Therapeutics Inc. which gained 32.65% to close at 1.300. The worst performers were Determine Inc. which was down 25.04% to 0.494 in late trade, ConforMIS Inc. which lost 22.46% to settle at 0.56 and Smaaash Entertainment Inc. which was down 19.64% to 2.67 at the close.

Oil

Oil prices pared gains in a volatile trade yesterday as fears flared that demand would stall due to a trade war between the U.S and China, and as Russia remained a stumbling block to a deal to cut global crude supply. U.S President made clear he would revert to tariffs on China if the two sides could not resolve their differences. The comments put a damper on market enthusiasm that drove oil about 4 percent higher on Monday after Trump and Chinese counterpart Xi Jinping agreed at a meeting of the Group of 20 industrialized nations to pause an escalating trade dispute. In Monday’s session, expectations of a production cut by the OPEC and its allies, when they meet on Thursday and Friday in Vienna, had also supported prices. OPEC and its allies are working towards a deal to reduce oil output by at least 1.3 million barrels per day, four sources said yesterday, adding that Russia’s resistance to a significant production cut was so far the main stumbling block.

 

Precious and Base Metals

Gold rose to its highest in more than five weeks yesterday as the dollar sagged after the United States and China agreed a 90-day pause on fresh trade tariffs, while palladium hit a record high, leaving it about $4 short of parity with bullion. Palladium rose more than 2 percent to $1,231.50 per ounce, after scaling an all-time high of $1,235. The market is structurally in a significant deficit, so there are clearly concerns about that. We’ve got a lot momentum and positive investor sentiment flowing into the market at the moment. The metal, used mainly used in emissions-reducing auto catalysts for vehicles, has gained about 48 percent since mid-August, but not all analysts think the price is justified. The high price premium on palladium is not justified in our opinion because car sales have been fairly weak on all key markets of late. U.S. tariffs have been threatened on imports of cars and car parts from the European Union. Meanwhile, spot gold rose for the second straight session, up 0.6 percent at $1,238.90. Prices touched $1,241.10 earlier in the session, their highest since Oct. 26. U.S. gold futures were up 0.4 percent at $1,244.70 per ounce. The dollar weakened against its major peers, pressured by a thaw in trade tensions between Washington and Beijing, making gold cheaper for holders of other currencies. Primarily it is the weaker dollar that is providing assistance and that will be the key driver in the short term. However, it is going to find it difficult to sustain the current rally unless there is even more dollar weakness, simply because the overall investor sentiment for riskier assets has improved and that would prove to be a drag in the short term. The temporary freeze on further hostilities in the trade war sparked a global rally in equity markets on Monday. Global trade tensions over the past few months have seen investors opt for the safety of the U.S currency rather than bullion, a traditional safe haven asset. Among other precious metals, spot silver rose 1 percent to $14.52 per ounce.

 

 

Traditional Agricultures

Soybeans were little changed yesterday as dealers awaited concrete indications that China will resume its huge imports of U.S soy halted by the trade war between the two countries. Corn and wheat are being undermined by the lack of strength in soybeans.

 

Futures Settlement Price Tuesday, December 04, 2018
Instrument Contract Open High Low Settlement Net Change
DJIA DJM18 25835 25837 25016 25046 -800
S & P 500 SPM18 2789.75 2790.25 2697 2701.75 -89.25
NASDAQ 100 NDM18 7054.25 7055 6788 6802.5 -256
Hang Seng HSH18 27108 27292 27037 27266 -15
Nikkei 225 NKH18 22590 22600 22015 22035 -570
FTSE 100 FTH18 7055 7098.5 6924.5 6940 -153
Gold GCJ18 1243.8 1244.4 1239.2 1240.2 -3.4
Silver SIK18 1459.5 1461 1449 1452 -7
Copper HGK18 275.85 276.95 275.5 276.1 0.25
Crude Oil CLK18 53.1 54.52 52.41 52.56 -0.49
Wheat WK18 521.25 521.75 519.5 520.25 -1.75
Soybeans SK18 903.25 912.5 899.25 911.25 5.75
Corn CK18 383 383.75 382.5 383.5 -0.75

 

Daily Swings  (The Pivot Levels)
  Trading Range  
Contract S3 S2 S1 Pivot R1 R2
DJM18 23941 24479 24762 25300 25583 26121 26404
SPM18 2575.83 2636.42 2669.08 2729.67 2762.33 2822.92 2855.58
NDM18 6441.67 6614.83 6708.67 6881.83 6975.67 7148.83 7242.67
HSH18 26850 26943 27105 27198 27360 27453 27615
NKH18 21248 21632 21833 22217 22418 22802 23003
FTH18 6702.83 6813.67 6876.83 6987.67 7050.83 7161.67 7224.83
GCJ18 1232.93 1236.07 1238.13 1241.27 1243.33 1246.47 1248.53
SIK18 1435.00 1442.00 1447.00 1454.00 1459.00 1466.00 1471.00
HGK18 273.97 274.73 275.42 276.18 276.87 277.63 278.32
CLK18 49.70 51.05 51.81 53.16 53.92 55.27 56.03
WK18 517.00 518.25 519.25 520.50 521.50 522.75 523.75
SK18 889.58 894.42 902.83 907.67 916.08 920.92 929.33
CK18 381.50 382.00 382.75 383.25 384.00 384.50 385.25

 

 Source: – News & Quotes (Courtesy:  Reuters)                                                                    

Disclaimer

This information has been prepared for information only and does not constitute an offer or commitment. This information does not constitute investment advice as defined by the rules of the FCA.

The firm or its staff members may trade on their own account and may from time to time hold or act as market makers in investments mentioned in this document. Please note that the firm makes no warranty, expressed or implied, as to the accuracy or completeness of the information and opinions herein. All parties are advised to seek independent professional advice as to the suitability of any products and to their tax, accounting, legal or regulatory implications. City Credit Capital (UK) Ltd is authorized and regulated by the Financial Conduct Authority, reg 232015.