Daily Market View
Thursday, October 18, 2018
| U.S Stock Market
Wall Street stocks retreated earlier yesterday following lackluster U.S housing data and mixed corporate earnings. About 20 minutes into trading, the Dow Jones Industrial Average was down 0.7 percent. The broad-based S&P 500 fell 0.3 percent, while the tech-rich NASDAQ Index lost 0.4 percent. The early weakness came after US stocks had surged Tuesday, partially recovering losses suffered the prior week. Government housing data showed drops in both new construction and permits in September, the latest sign of weakness for a market that has been pressured by higher lumber costs and increasing interest rates. But later in the day after the release of FOMC minutes U.S stocks reversed early losses to end the day slightly lower. Dow member IBM sank six percent after the technology giant reported a drop of two percent in third-quarter revenues to $18.8 billion, below analyst expectations. But other companies had strong results, including Netflix, which surged 7.1 percent after reporting that quarterly profit more than tripled to $403 million.
|Major Economic Releases for Today|
|Australia Employment Change (SEP)||00:30||15.0k||44.0k|
|Australia Unemployment Rate (SEP)||00:30||5.3%||5.3%|
||BOJ Kuroda speaks at Branch Managers’s Meeting||00:30|
|U.K Retail Sales Ex Auto Fuel (YoY) (SEP)||08:30||3.8%||3.5%|
|U.S Philadelphia Fed Business Outlook (OCT)||12:30||20||22.9|
|U.S Initial Jobless Claims (OCT 13)||12:30||210k||214k|
|U.S Continuing Claims (OCT 6)||12:30||1668k||1660k|
|U.S Leading Index (SEP)||14:00||0.5%||0.4%|
|Japan National Consumer Price Index (YoY) (SEP)||23:30||1.3%||1.3%|
|Dow Jones Industrial Average
The Dow Jones Industrial Average lost 0.36%. The best performers of the session on the Dow Jones Industrial Average were Goldman Sachs Group Inc., which rose 2.97% or 6.58 points to trade at 228.28 at the close. Meanwhile, Johnson & Johnson added 2.12% or 2.90 points to end at 139.46 and McDonald’s Corporation was up 1.65% or 2.70 points to 166.77 in late trade. The worst performers of the session were International Business Machines, which fell 7.63% or 11.07 points to trade at 134.05 at the close. Home Depot Inc. declined 4.34% or 8.41 points to end at 185.17 and UnitedHealth Group Incorporated was down 1.93%.
The NASDAQ index fell 0.04%. The top performers on the NASDAQ were Yulong Eco-Materials Ltd which rose 569.69% to 10.200, China Advanced Construction Materials which was up 62.28% to settle at 3.700 and Sears Holdings Corporation which gained 57.50% to close at 0.63. The worst performers were Revolution Lighting Technologies which was down 38.28% to 1.5800 in late trade, Bridgeline Digital Inc. which lost 32.41% to settle at 0.4721 and Blink Charging Co which was down 31.18% to 2.4500 at the close.
Oil prices fell yesterday, with U.S futures dipping below $70 a barrel for the first time in a month, after U.S stockpiles rose by 6.5 million barrels, almost triple what analysts had forecast, while exports dropped. U.S light crude oil ended yesterday’s session down $2.17, or 3 percent, at $69.75. Oil had been rising on worries about Iranian sanctions and tensions between the U.S and Saudi Arabia after the death of Saudi journalist Jamal Khashoggi. U.S. crude stocks rose 6.5 million barrels last week, the fourth straight weekly build, as exports were down to 1.8 million barrels per day, the U.S EIA said in a report. Inventories rose sharply even as U.S. crude production slipped 300,000 bpd to 10.9 million bpd last week, which analysts attributed to the effects of offshore facilities closing temporarily for Hurricane Michael. A tick higher in refining activity and a drop in production due to hurricane activity in the Gulf was not enough to halt a fourth consecutive climb in stocks – and a solid one at that.
|Precious and Base Metals
Gold prices edged up yesterday, carried along by a retreat in global stock markets and technical momentum, despite the normally bearish influence of a stronger dollar. Spot gold was up 0.1 percent at $1,224.87 per ounce, just below the 2-1/2 month peak of $1,233.26 scaled on Monday as a rout in stock markets forced investors to seek safety in the metal. U.S. gold futures were down 0.2 percent at $1,228.10 per ounce. Gold is rising as the stock market is giving back gains and you have enough to worry about in the world to keep the metal from selling off. But the rallies are being capped by expectations of the Federal Reserve’s rate hike expectations. A global stock market rally proved short-lived as warnings over a slowing European auto sector soured the upbeat mood. Wall Street fell on disappointing results from IBM, after enjoying its best session in eight months the previous day. The Fed raised interest rates last month for the third time this year and said it planned four more increases by the end of 2019 and another in 2020. Gold was also getting a leg from nervous shorts, who are trying to pull out. The market was surprised by the extended short positions and the spike indicated a lot of traders were wrong-footed. It also indicates that the dips are being used to cover the short positions. Gold was testing resistance at the 100-day moving average of about $1,226, and a convincing break above that is seen as a bullish sign for investors who follow technical signals. Meanwhile, some central banks have taken their holdings of gold to record levels in recent months in an effort to maintain the value of their currencies against a rising U.S dollar. Holdings of SPDR Gold Trust, the largest gold-backed exchange traded fund, have risen about 2.5 percent in the past eight days, which analysts said shows a shift in perception in sentiment among gold ETF investors. In other metals, silver slipped 0.1 percent at $14.63 per ounce.
Soybean futures fell for a second session yesterday as forecasts of dry weather in parts of the United States indicated farmers there would be able to pick up the pace of harvesting. Soybean and corn prices have come under pressure from expectations that dry weather across the U.S Midwest will aid harvesting.
|Futures Settlement Price Wednesday, October 17, 2018|
|S & P 500||SPM18||2816.25||2824.25||2783.25||2816.5||-2|
|Daily Swings (The Pivot Levels)|
Source: – News & Quotes (Courtesy: Reuters)
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