Daily Market View
Wednesday, December 19, 2018
| U.S Stock Market
Stocks rebounded yesterday, recovering some of the steep losses of the prior trading session that sent both the Dow Jones Industrial Average and the S&P 500 down more than 2 percent. The S&P 500 climbed 0.9 percent after falling to a new closing low and touching a new intraday low for 2018 on Monday on fears the Federal Reserve is going too far with its rate-hiking plans. The Dow Jones Industrial Average rallied 300 points, led higher by gains in Boeing and Johnson & Johnson. A comeback in technology stocks led the NASDAQ to a 1.2 percent gain as Amazon, Apple and Netflix — which were hit hard on Monday — all traded higher. Facebook stock rallied 3.6 percent while Google-parent Alphabet added 3.1 percent. Also helping sentiment was White House Press Secretary Sarah Sanders, who said that the Trump administration wants to avoid a partial government shutdown and has found alternative revenues to build President Donald Trump’s border wall. The Fed is widely expected to hike its benchmark lending rate for a fourth and final time of 2018.
|Major Economic Releases for Today|
|German Producer Price Index (YoY)||07:00||3.1%||3.3%|
|U.K Consumer Price Index (YoY)||09:30||2.3%||2.4%|
|U.K House Price Index (YoY)||09:30||3.3%||3.5%|
|U.S MBA Mortgage Applications||12:00||1.6%|
|Canada Consumer Price Index (YoY)||13:30||1.8%||2.4%|
|U.S Existing Home Sales (MoM)||15:00||-0.4%||1.4%|
|DOE U.S. Crude Oil Inventories||15:30||-1208k|
|U.S FOMC Rate Decision||19:00||2.50%||2.25%|
||Fed’s Powell Holds Press Conference Following FOMC Decision||19:30|
|Dow Jones Industrial Average
The Dow Jones Industrial Average gained 0.35%. The best performers of the session on the Dow Jones Industrial Average were Boeing Co, which rose 3.77% or 11.93 points to trade at 328.06 at the close. Meanwhile, Goldman Sachs Group Inc. added 2.08% or 3.49 points to end at 171.50 and Nike Inc. was up 1.79% or 1.25 points to 71.15 in late trade. The worst performers of the session were Exxon Mobil Corp, which fell 2.76% or 2.04 points to trade at 72.00 at the close. Chevron Corp declined 2.41% or 2.71 points to end at 109.74 and UnitedHealth Group Incorporated was down 1.98% or 5.10 points to 252.97.
The NASDAQ index gained 0.45%. The top performers were Biocept Inc. which rose 66.28% to 1.140, Marin Software Inc. which was up 30.07% to settle at 3.720 and Toughbuilt Industries Inc. which gained 22.04% to close at 1.55. The worst performers were Regulus Therapeutics Inc. which was down 24.09% to 1.040 in late trade, Dova Pharmaceuticals Inc. which lost 23.64% to settle at 6.88 and Champions Oncology Inc. which was down 23.04% to 7.3500 at the close.
Oil prices tumbled yesterday after reports of swelling inventories and forecasts that record U.S and Russian output will hit a market that may see weaker demand if global growth deteriorates as many expect. U.S crude oil fell $2.78, or 5.5 percent to trade at $47.10 a barrel. The session low was $46.97, its weakest since September 2017. World stock markets inched higher as investors looked ahead to whether the U.S Federal Reserve will be able to raise interest rates much further. Equity markets have had steep declines over the last two months. Investor confidence is deteriorating, with more fund managers expecting global growth to weaken over the next 12 months, the worst outlook in a decade, Bank of America Merrill Lynch’s December investor survey showed. Britain’s largest oilfield restarted, increasing supply, the U.S government said output from shale would top 8 million barrels per day this year, and data suggested U.S. crude inventories would rise this week. Crude oil has slid more than 30 percent since early October.
|Precious and Base Metals
Gold rose to a one-week high yesterday, helped by a weaker U.S dollar and a fall in global stock markets, but moves were limited as investors sought clarity on the path of U.S interest rates as concerns about a slowing global economy deepened. Spot gold was up 0.1 percent at $1,247.06 per ounce, having earlier touched its highest since Dec. 10 at $1,250.27, just short of a five-month peak of $1,250.55 hit last week. U.S gold futures were steady at $1,251.30 per ounce. There has been a slight increase in the minority view that the Fed might not raise rates, given the recent weakness in the equity markets. It would be quite a shock if they didn’t increase rates in this week’s meeting. Most of the attention will be on how many more interest rates rises there may be next year. The Fed is widely expected to raise interest rates for the fourth time this year at its two-day policy meeting ending today. But weak stock markets and slowing global growth may prompt the central bank to signal a slowdown in rate increases. We have seen quite a broad-based sell-off across many other markets, from equities to other commodity markets, and an increase in risk aversion. In that climate, gold is edging gradually higher towards a multi-months peak. World stock markets tumbled as fears about a slowing global economy gripped investors, while the dollar index slipped 0.3 percent against a basket of major currencies. Gold tends to gain when interest rate hike expectations ease because lower rates reduce the opportunity cost of holding non-yielding bullion and weigh on the dollar, in which it is priced. In euro terms, gold reached its highest since June at 1,100.57 euro an ounce. Gold, considered a safe investment during times of financial, economic and geopolitical uncertainty, has risen more than 7 percent from 19-month lows hit in mid-August. It is also set to post its biggest quarterly gains since March 2017. Among other precious metals, silver was down 0.2 percent to $14.63.
Soybean futures edged higher yesterday as the oilseed market awaited signs of further demand from China as part of a trade truce with Washington. Wheat eased after gaining ground on Monday while corn ticked upwards in cautious trading.
|Futures Settlement Price Tuesday, December 18, 2018|
|S & P 500||SPM18||2557||2577.5||2531||2537||-18.25|
|Daily Swings (The Pivot Levels)|
Source: – News & Quotes (Courtesy: Reuters)
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