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posted on 19 May 2017

Investing.com Weekly Wrap-Up 19 May 2017

Written by , Investing.com

U.S. stocks higher at close of trade; Dow Jones Industrial Average up 0.69%

U.S. stocks were higher after the close on Friday, as gains in the Oil & Gas, Industrials and Basic Materials sectors led shares higher.

At the close in NYSE, the Dow Jones Industrial Average added 0.69%, while the S&P 500 index added 0.68%, and the NASDAQ Composite index climbed 0.47%.


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The best performers of the session on the Dow Jones Industrial Average were Caterpillar Inc (NYSE:CAT), which rose 2.21% or 2.21 points to trade at 102.43 at the close. Meanwhile, General Electric Company (NYSE:GE) added 2.07% or 0.57 points to end at 28.05 and Boeing Co (NYSE:BA) was up 1.89% or 3.36 points to 180.76 in late trade.

The worst performers of the session were Cisco Systems Inc (NASDAQ:CSCO), which fell 0.54% or 0.17 points to trade at 31.21 at the close. Merck & Company Inc (NYSE:MRK) declined 0.17% or 0.11 points to end at 63.78 and The Travelers Companies Inc (NYSE:TRV) was down 0.07% or 0.09 points to 120.79.

The top performers on the S&P 500 were Autodesk Inc (NASDAQ:ADSK) which rose 14.69% to 109.91, Frontier Communications Corporation (NASDAQ:FTR) which was up 12.31% to settle at 1.46 and McKesson Corporation (NYSE:MCK) which gained 8.18% to close at 153.01.

The worst performers were Foot Locker Inc (NYSE:FL) which was down 16.65% to 58.72 in late trade, Gap Inc (NYSE:GPS) which lost 3.92% to settle at 22.28 and Ralph Lauren Corporation (NYSE:RL) which was down 2.93% to 69.29 at the close.

The top performers on the NASDAQ Composite were Cumulus Media Inc (NASDAQ:CMLS) which rose 26.90% to 0.4949, Destination XL Group Inc (NASDAQ:DXLG) which was up 21.25% to settle at 2.425 and Sportsmans (NASDAQ:SPWH) which gained 20.51% to close at 5.70.

The worst performers were Bridgeline Digita (NASDAQ:BLIN) which was down 17.00% to 0.5726 in late trade, JMU Ltd (NASDAQ:JMU) which lost 16.44% to settle at 1.830 and Motif Bio PLC (NASDAQ:MTFB) which was down 13.23% to 7.66 at the close.

Rising stocks outnumbered declining ones on the New York Stock Exchange by 2382 to 843 and 37 ended unchanged; on the Nasdaq Stock Exchange, 1539 rose and 970 declined, while 117 ended unchanged.

Shares in Autodesk Inc (NASDAQ:ADSK) rose to all time highs; gaining 14.69% or 14.08 to 109.91. Shares in Ralph Lauren Corporation (NYSE:RL) fell to 5-year lows; down 2.93% or 2.09 to 69.29. Shares in JMU Ltd (NASDAQ:JMU) fell to all time lows; losing 16.44% or 0.360 to 1.830.

The CBOE Volatility Index, which measures the implied volatility of S&P 500 options, was down 17.46% to 12.10.

Gold Futures for June delivery was up 0.17% or 2.11 to $1254.91 a troy ounce. Elsewhere in commodities trading, Crude oil for delivery in June rose 2.15% or 1.06 to hit $50.41 a barrel, while the July Brent oil contract rose 2.25% or 1.18 to trade at $53.69 a barrel.

EUR/USD was up 0.91% to 1.1204, while USD/JPY fell 0.22% to 111.24.

The US Dollar Index Futures was down 0.76% at 97.03.

See also Dow notches more than 100 points but ends week in negative.

Read additional news from Reuters at Investing.com.

Forex

The dollar fell against a basket of major currencies on Friday, as investors ditched the greenback amid ongoing U.S. political uncertainty while dovish comments from St. Louis Federal Reserve president James Bullard weighed on sentiment.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, fell by 0.68% to 97.11 by 13:12 EDT.

Political uncertainty has dominated moves in the greenback, which has erased most of the gains achieved since President Trump’s election, as investors started to question whether Trump would be able to deliver on his pro-growth economic agenda in the wake of continued political uncertainty in Washington.

In what a subdued day of top-tier economic data release, investors parsed through somewhat dovish comments from St. Louis Federal Reserve President, James Bullard, on Friday.

Bullard suggested the Fed’s policy path of two more rate hikes this year is “overly aggressive" relative to the pace of recent economic growth.

Bullard’s comments weighed on the dollar but failed to dampened hopes of a June rate hike, as the St. Louis Fed President is not a voting member of the Fed policy committee.

According to investing.com’s Fed rate monitor tool, 70% of traders expect the Federal Reserve to hike interest rates in June.

Meanwhile, EUR/USD soared to $1.1188, up 0.77%, while EUR/GBP tacked on 0.10% to trade at 0.8593, after a bout of positive European data fuelled expectations that the European Central Bank would consider the possibility of tapering its expansive monetary stimulus programme.

GBP/USD rose 0.63% to $1.3022, while USD/JPY traded flat at 111.41.

Meanwhile, a strong rise in oil prices underpinned a move higher in oil-sensitive Canadian dollar but gains were capped by a mixed bag of economic data, after the rate of inflation in April fell short of expectations, while retail sales grew faster than expected.

USD/CAD traded at $1.3540, down 0.46%.

See also Forex - Dollar continues to slide as U.S. political turmoil dominates.

Commitments of Traders

This week speculators were turned bullish on the euro and became less bullish on oil, the S&P 500, and the Aussie $.

Note: This data is for the week ending on Tuesday so the last three days (this week two because markets were closed Friday) of trading are not reflected.

cot.2017.may.10

Gold

Gold futures traded flat on Friday, but remained on track for its biggest weekly win since mid-April, supported by a slide in the dollar amid ongoing U.S. political turmoil.

Gold for June delivery on the Comex division of the New York Mercantile Exchange gained $1.20 or 0.10%, to $1,254.03 a troy ounce by 13:51 EDT.

Investors appeared to take profits in gold in the midst of the precious metal’s best trading week since April - gold is on track to book at 2% weekly gain amid a tumultuous week in U.S. politics.

The Justice Department earlier this week appointed former FBI Director Robert Mueller as a special counsel to lead a federal investigation into allegations that President Trump collaborated with Russia during the 2016 election.

President Trump remained defiant in the wake of continued allegations that members of his campaign colluded with Russia during the U.S. presidential election.

Trump warned that the special counsel investigation “hurts our country" and labeled the probe “a witch hunt".

Investors have piled into safe-haven assets such as gold, as they fear that the continued political saga in Washington could dampened President’s Trump ability to deliver on his economic agenda.

Rising doubts over Trump’s ability to deliver on this pro-growth economic agenda, pushed the dollar to a six-month low on Friday, which helped steady gold futures.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, fell by 0.68% to 97.11 by 13:12 EDT.

Dollar-denominated assets such as gold are sensitive to moves in the dollar - A dip in the dollar makes gold cheaper for holders of foreign currency and thus, increases demand.

Meanwhile, investors parsed through somewhat dovish comments from St. Louis Federal Reserve President, James Bullard, on Friday.

Bullard suggested the Fed’s policy path of two more rate hikes this year is “overly aggressive" relative to the pace of recent economic growth.

According to investing.com’s Fed rate monitor tool 70% of traders expect the Federal Reserve to hike its benchmark rate in June.

The dollar slump supported commodity prices across the board, as silver futures rose 0.91% to $16.822 a troy ounce while platinum added 0.59% to trade at $942.35.

Copper added 1.99% to $2.582, while natural gas rose by 2.48% to $3.261.

Oil

Crude futures settled higher on Friday, as investors turned attention to the OPEC meeting next week amid growing expectations that OPEC members will extend supply cuts for a prolonged period.

On the New York Mercantile Exchange crude futures for June delivery gained 98 cents to settle at $50.33 a barrel, while on London's Intercontinental Exchange, Brent added 0.97 cents to trade at $53.48 a barrel.

Investors hopes of an extension of the current supply-cut agreement to March 2018, received a boost on Thursday, after Algerian Energy Minister, Noureddine Boutarfa, said that most OPEC members support Saudi Arabia and Russia’s proposal to prolong the production cuts to March next year, and that the rate of compliance should increase.

Saudi Arabia and Russia agreed earlier this week that the production cuts needed to be extended for a period of nine months until March 2018.

"There has been a marked reduction to the inventories, but we're not where we want to be in reaching the five-year average," Saudi Energy Minister Khalid al-Falih said on Monday.

In November last year, OPEC and other producers, including Russia agreed to cut output by about 1.8 million barrels per day (bpd). The deal to cut supply started in January this year for a period of six months until June.

OPEC is expected to decide at talks on May 25 whether to extend the current deal to cut production.

Meanwhile, the rising level of U.S. oil output returned to the fore, after oilfield services firm Baker Hughes reported its weekly U.S. rig count rose by 8 to 720.

Crude prices posted a second-straight weekly gain, settling above the key $50 level for the first time since April.

Natural Gas (Thursday Report)

U.S. natural gas futures edged higher on Thursday, despite data showing that natural gas supplies in storage in the U.S. rose more than expected last week.

U.S. natural gas for June delivery ticked up 1.3 cents, or around 0.4%, to $3.205 per million British thermal units by 10:35AM ET (14:35GMT).

Futures were at around $3.192 prior to the release of the supply data before falling to a session low of $3.168, the weakest level since May 8.

Prices of the heating fell 3.8 cents on Wednesday amid bearish weather forecasts.

The U.S. Energy Information Administration said in its weekly report that natural gas storage in the U.S. rose by 68 billion cubic feet in the week ended May 12, above forecasts for a build of 61 billion.

That compared with a gain of 45 billion cubic feet in the preceding week, an increase of 73 billion a year earlier and a five-year average rise of 87 billion cubic feet.

Total natural gas in storage currently stands at 2.369 trillion cubic feet, according to the U.S. Energy Information Administration, 13.6% lower than levels at this time a year ago but 10.8% above the five-year average for this time of year.

Meanwhile, the latest U.S. weather model called for mild temperatures over the next two weeks, which should reduce demand during that time.

Natural gas prices have closely tracked weather forecasts in recent weeks, as traders try to gauge the impact of shifting outlooks on spring heating demand.

Gas use typically hits a seasonal low with spring's mild temperatures, before warmer weather increases demand for gas-fired electricity generation to power air conditioning.

Nearly 50% of all U.S. households use gas for heating.

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