Daily Market View
Thursday, December 13, 2018
| U.S Stock Market
U.S stocks advanced as the outlook for trade took a positive turn and confidence grew that the British prime minister will defeat a challenge to her leadership. The S&P 500 rose as much as 1.9 percent before an afternoon slump that cut the advance by more than half. The slide marks the fourth straight day that investors have sold an early rally, continuing a trend that’s a stark reversal from months where traders bought any meaningful dip. Oil’s retreat coincided with the move, amid reports that deep discord exists among OPEC members ahead of planned output cuts. The early gains came as signs emerged that trade tensions would ease, first after the arrested Huawei executive was granted bail and then when President Donald Trump suggested he could use his influence to calm that situation as part of a deal with China. For its part, China hinted that it would ease access to local markets. Treasuries and the dollar both slipped as data showed a key measure of U.S inflation picked up as expected in November.
|Major Economic Releases for Today|
||Summit of EU Leaders|
|U.K RICS House Price Balance||00:01||-10.0%||-10.0%|
|German Consumer Price Index (YoY)||07:00||2.3%||2.3%|
|SNB Sight Deposit Interest Rate||08:30||-0.75%||-0.75%|
||SNB’s Jordan Speaks at Press Conference in Bern||09:00|
|European Central Bank Rate Decision||12:45||0.00%||0.00%|
|Canada New Housing Price Index (YoY)||13:30||0.1%||0.2%|
|U.S Initial Jobless Claims||13:30||225k||231k|
|U.S Monthly Budget Statement||19:00||-$197.0b||-$100.5b|
|Dow Jones Industrial Average
The Dow Jones Industrial Average added 0.64%. The best performers of the session were DowDuPont Inc., which rose 2.05% or 1.09 points to trade at 54.35 at the close. Meanwhile, American Express Company added 1.97% or 2.08 points to end at 107.48 and Caterpillar Inc. was up 1.73% or 2.13 points to 125.37 in late trade. The worst performers of the session were Verizon Communications Inc., which fell 2.72% or 1.60 points to trade at 57.25 at the close. Exxon Mobil Corp declined 0.86% or 0.66 points to end at 76.02 and Walmart Inc. was down 0.79% or 0.74 points to 93.11.
The NASDAQ index added 0.95%. The top performers on the NASDAQ were Teligent Inc. which rose 30.80% to 1.805, Staffing 360 Solutions Inc. which was up 28.79% to settle at 1.700 and EyeGate Pharmaceuticals Inc. which gained 28.30% to close at 0.513. The worst performers were Synergy Pharmaceuticals Inc. which was down 52.80% to 0.160 in late trade, Yangtze River Port and Logistics Ltd which lost 23.34% to settle at 4.86 and Neurotrope Inc. which was down 23.03% to 3.8100 at the close.
U.S crude oil inventories fell less than expected last week, the Energy Information Administration said in its weekly report yesterday. The EIA data showed that crude oil inventories decreased by 1.21 million barrels in the week to Dec. 7. That was compared to forecasts for a stockpile draw of 2.99 million barrels, after a drop of 7.32 million barrels in the previous week, amounting to a second straight weekly decline. The EIA report also showed that gasoline inventories rose by 2.09 million barrels, compared to expectations for a build of 2.46 million barrels, while distillate stockpiles unexpectedly decreased by 1.48 million barrels, compared to forecasts for a gain of 1.80 million. Ahead of the release, oil prices had already been climbing after the American Petroleum Institute’s weekly report said on Tuesday that U.S. crude inventories fell by 10.2 million barrels last week. Oil has also been supported this week by the supply loss in Libya, which declared force majeure on exports from the country’s largest oilfield on Sunday.
|Precious and Base Metals
Gold prices edged higher yesterday as the dollar slipped and expectations for the number of U.S interest rate hikes next year dimmed, increasing the appeal of non-interest yielding bullion. Spot gold was up 0.1 percent at $1,244.40 per ounce. U.S gold futures settled up $2.80, or 0.22 percent, at $1,250. The dollar was weaker against a basket of currencies after data showed U.S consumer prices were unchanged in November, supporting the view that underlying inflation remained firm, but not enough to push the Federal Reserve to take a more aggressive stance. We are seeing a bit of support from a weaker dollar across the commodities complex. In addition to that, we are seeing an ongoing outflow of funds from equities and that money flow into alternative assets continues to support the precious metals complex. Investors kept an eye out for developments around U.S-China trade talks, and on Brexit after lawmakers in British Prime Minister Theresa May’s Conservatives gathered enough support to trigger a no-confidence vote in her leadership yesterday. The safe-haven assets continue to be well supported in this environment and that along with some recent comments from the Fed on changing their potential path on interest rates has also been supportive. Markets are not expecting more than one rate hike from the U.S central bank next year, after a likely interest rate increase at the Federal Open Market Committee (FOMC) meeting on Dec. 18-19. Next week’s FOMC meeting is going to be the last major economic event of the year. The gold market has started to price in the ‘one and done’ interest rate scenario. Dollar-denominated bullion earlier this week touched its highest level in five months at $1,250.55 per ounce as chances of slower interest rate hikes reduced the opportunity cost of holding the yellow metal. Indicative of investor interest in gold, holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, rose to the highest level since late August on Tuesday.
Soybean futures hit a 4-1/2-month high yesterday as China bought U.S soybeans for the first time since U.S President Donald Trump and his Chinese counterpart Xi Jinping met in early December.
|Futures Settlement Price Wednesday, December 12, 2018|
|S & P 500||SPM18||2632.5||2686.25||2631.5||2651||10.5|
|Daily Swings (The Pivot Levels)|
Source: – News & Quotes (Courtesy: Reuters)
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