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posted on 12 January 2018

Investing.com Weekly Wrap Up 12January 2018

Written by , Investing.com

U.S. stocks higher at close of trade; Dow Jones Industrial Average up 0.89%

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

At the close in NYSE, the Dow Jones Industrial Average rose 0.89% to hit a new all time high, while the S&P 500 index added 0.68%, and the NASDAQ Composite index climbed 0.68%.


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The best performers of the session on the Dow Jones Industrial Average were Boeing Co (NYSE:BA), which rose 2.47% or 8.09 points to trade at 336.21 at the close. Meanwhile, Cisco Systems Inc (NASDAQ:CSCO) added 1.92% or 0.77 points to end at 40.87 and Merck & Company Inc (NYSE:MRK) was up 1.84% or 1.06 points to 58.66 in late trade.

The worst performers of the session were General Electric Company (NYSE:GE), which fell 1.37% or 0.26 points to trade at 18.76 at the close. International Business Machines (NYSE:IBM) declined 0.65% or 1.06 points to end at 163.14 and Procter & Gamble Company (NYSE:PG) was down 0.60% or 0.54 points to 89.61.

The top performers on the S&P 500 were Viacom B Inc (NASDAQ:VIAB) which rose 9.57% to 33.76, Lowe’s Companies Inc (NYSE:LOW) which was up 5.35% to settle at 100.86 and Seagate Technology PLC (NASDAQ:STX) which gained 4.60% to close at 51.26.

The worst performers were Aflac Incorporated (NYSE:AFL) which was down 7.36% to 84.94 in late trade, American Water Works (NYSE:AWK) which lost 4.61% to settle at 80.83 and Facebook Inc (NASDAQ:FB) which was down 4.47% to 179.37 at the close.

The top performers on the NASDAQ Composite were SPAR Group Inc (NASDAQ:SGRP) which rose 59.68% to 1.980, My Size Inc (NASDAQ:MYSZ) which was up 43.62% to settle at 2.14 and Turtle Beach Corp (NASDAQ:HEAR) which gained 41.16% to close at 0.620.

The worst performers were AquaBounty Technologies Inc (NASDAQ:AQB) which was down 37.73% to 3.020 in late trade, Aradigm Cor (NASDAQ:ARDM) which lost 33.92% to settle at 2.260 and Xunlei Ltd Adr (NASDAQ:XNET) which was down 27.38% to 16.63 at the close.

Rising stocks outnumbered declining ones on the New York Stock Exchange by 1671 to 1415 and 119 ended unchanged; on the Nasdaq Stock Exchange, 1459 rose and 1049 declined, while 129 ended unchanged.

Shares in Lowe’s Companies Inc (NYSE:LOW) rose to all time highs; up 5.35% or 5.12 to 100.86. Shares in Seagate Technology PLC (NASDAQ:STX) rose to 52-week highs; gaining 4.60% or 2.26 to 51.26. Shares in Boeing Co (NYSE:BA) rose to all time highs; rising 2.47% or 8.09 to 336.21. Shares in Cisco Systems Inc (NASDAQ:CSCO) rose to 5-year highs; up 1.92% or 0.77 to 40.87. Shares in SPAR Group Inc (NASDAQ:SGRP) rose to 52-week highs; rising 59.68% or 0.740 to 1.980. Shares in AquaBounty Technologies Inc (NASDAQ:AQB) fell to 52-week lows; falling 37.73% or 1.830 to 3.020.

The CBOE Volatility Index, which measures the implied volatility of S&P 500 options, was up 2.73% to 10.15.

Gold Futures for February delivery was up 1.26% or 16.70 to $1339.20 a troy ounce. Elsewhere in commodities trading, Crude oil for delivery in February rose 0.97% or 0.62 to hit $64.42 a barrel, while the March Brent oil contract rose 0.82% or 0.57 to trade at $69.83 a barrel.

EUR/USD was up 1.37% to 1.2197, while USD/JPY fell 0.22% to 111.02.

The US Dollar Index Futures was down 1.11% at 90.64.

See also:

Forex

The dollar fell sharply against a basket of major currencies weighed by a surge in the euro and sterling, while upbeat US economic data failed to lift sentiment.

The sharp rise in the euro weighed on the dollar overshadowing a duo of mostly update reports on inflation and retail sales.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, fell 0.63% to 91.08.

The euro rallied against the greenback after Chancellor Angela Merkel struck a deal with the Social Democrat Party (SPD) on Friday, paving the way for government coalition talks, easing political uncertainty.

The Labor Department said on Friday its core Consumer Price index rose 0.3% in December, edging up 0.2% in November. The uptick in consumer prices in year-on-year through December rose to 2.1%.

The Commerce Department said on Friday that retail sales rose 0.4% in Decemberthat was below economists’ forecast for a 0.4% rise. While November’s retail sales reading was revised upward to 1.4% from 0.8%.

The upbeat inflation report would likely provide the Federal Reserve with the “ammo" to suggest that inflation is improving, Bank of Montreal said. While the weaker than expected retail sales data was downplayed as market participants focused on the large upward revision for November.

Also weighing on the dollar was a rally in sterling against the greenback to $1.3687 amid reports that several EU member countries are open to the idea of a softer Brexit, easing worries the EU may adopt a tough stance on trade discussions with Britain.

USD/JPY fell 0.02% to Y111.25, while USD/CAD fell 0.06% to C$1.2512.

Commitments of Traders (from ForexLive)

  • EUR long 145K vs 128K last week. Longs increased by 17K
  • GBP long 26K vs 16 long last week. Longs increased by 10K.
  • JPY short 126K vs 122 short last week. Shorts increased by 4K
  • CHF short 22K vs 16K short last week. Shorts increased by 6K
  • CAD long 17K vs 15K long last week. Longs increased by 2K.
  • AUD long 5K vs 20K short last week. Longs increase by 25K
  • NZD short 11K vs 17K short last week. Shorts decreased by 6K

Note: The data above is for the week ending on Tuesday 09 January so the last three days of trading are not reflected. The table below is from Investing.com for the week ending 02 January.

cot.2018.jan.05

Gold

Gold prices rose to four month highs shrugging off renewed signs of US inflationary pressure as dollar fell to lows amid euro and sterling pressure.

Gold futures for February delivery on the Comex division of the New York Mercantile Exchange rose by $11.20, or 0.85%, to $1,333.70 a troy ounce.

The euro and sterling rallied against the dollar, supporting dollar-denominated gold, as traders cheered easing political uncertainty in both the UK and Eurozone.

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

Chancellor Angela Merkel struck a deal with the Social Democrat Party (SPD) on Friday, paving the way for government coalition talks. While in the UK reports that several EU member countries are open to the idea of a softer brexit lessened investor worries of the EU adopting a tough stance on trade discussion with Britain.

Gold prices were on track extend their four-week rally despite signs of renewed inflation which may strengthened the Federal Reserve’s case for tightening monetary policy.

The Labor Department said on Friday its core Consumer Price index rose 0.3% in December, edging up 0.2% in November. The uptick in consumer prices in year-on-year through December rose to 2.1%.

Wells Fargo said the upbeat CPI data should help to allay some FOMC members' fears that “inflation is stuck at undesirably low levels."

In other precious metal trade, silver futures rose 0.97% to $17.13 a troy ounce, while platinum futures rose 0.57% to $996.40.

Copper fell 0.43% to $3.22, while natural gas rose 4.25% to $3.22 following storage data Thursday showing natural gas stockpiles fell more than expected.

Oil

Oil prices eased on Friday after hitting a three-year high of more than $70 a barrel the previous day, but they remained on track to post a fourth straight week of gains.

Brent crude futures (LCOc1) traded 6 cents lower at $69.20 a barrel at 1449 GMT. The contract broke above $70 on Thursday for the first time since December 2014.

U.S. West Texas Intermediate (WTI) crude futures (CLc1) were at $63.66, down 14 cents. WTI the day before rose to its strongest since late 2014 at $64.77. Hans van Cleef, senior energy economist at ABN Amro, said in a note:

"It is remarkable to see that most market analysts believe that prices have rallied too far since consensus forecasts are significantly lower than the current spot prices. On the other hand, most investors are still positioned to benefit from further price gains."

Analysts and traders have warned about the risk of a price correction since the start of 2018, but they say overall market conditions remain strong, mainly due to output cuts led by the Organization of the Petroleum Exporting Countries and Russia.

Fatih Birol, head of the Paris-based International Energy Agency, said on Friday that oil prices at $65 to $70 risked encouraging more oversupply from U.S. shale drillers.

Gulf OPEC producers plan to keep their oil output in the current quarter below the year-earlier level despite strong demand growth and a drop in global inventories, a senior OPEC source familiar with Gulf oil thinking said.

In addition to the OPEC and non-OPEC production cuts of 1.8 million barrels per day (bpd) that are due to last until the end of 2018, oil prices have found support from eight consecutive weeks of U.S. crude inventory drops.

U.S. commercial crude stocks fell by almost 5 million barrels in the week to Jan. 5, to 419.5 million barrels. That was slightly below the five-year average of just over 420 million barrels, the target for OPEC and others cutting output.

Relatively weak Chinese December oil data weighed on prices, traders and analysts said. China's crude imports in December fell 9 percent month-on-month to 33.7 million tonnes, or 7.97 million bpd, customs data showed.

This has contributed to a fall in Singapore refinery profit margins to below $6 per barrel this month, their lowest seasonal level in five years, leading some refiners to scale down crude runs.

Natural Gas (Thursday Report)

Natural gas futures surged on Thursday, hitting their highest level in a week after data showed the largest withdrawal on record in U.S. supplies in storage.

U.S. natural gas futures jumped 9.5 cents, or around 3.3%, to $3.002 per million British thermal units by 10:45AM ET (1545GMT). Futures were at around $3.015 prior to the release of the supply data.

The U.S. Energy Information Administration said in its weekly report that natural gas storage in the U.S. declined by 359 billion cubic feet (bcf) in the week ended Jan. 5, compared to forecasts for a withdrawal of 318 bcf.

That surpassed the record draw of 287 billion cubic feet in the week ended Jan. 10, 2014, Energy Information Administration data showed.

Total natural gas in storage currently stands at 2.767 trillion cubic feet (tcf), according to the U.S. Energy Information Administration. That figure is 415 bcf, or around 13.0%, lower than levels at this time a year ago and 382 bcf, or roughly 12.1%, below the five-year average for this time of year.

Prices have gained around 5% so far this week as investors reacted to the severe winter storm hitting much of the U.S. Eastern Seaboard.

Bullish speculators are betting that the cool weather will increase demand for the heating fuel. The heating season from November through March is the peak demand period for U.S. gas consumption.

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