Investing.com Weekly Wrap-Up 14 March 2014

U.S. stocks slide on Ukraine fears, weak U.S. data; Dow drops 0.27%

by Investing.com Staff, Investing.com

Escalating tensions in Ukraine coupled with soft U.S. consumer sentiment and wholesale pricing data sent U.S. stocks falling on Friday.

At the close of U.S. trading, the Dow Jones Industrial Average fell 0.27%, the S&P 500 index fell 0.28%, while the Nasdaq Composite index fell 0.35%.

The Thomson Reuters/University of Michigan preliminary consumer sentiment index fell to 79.9 for March from 81.6 in February, defying market expectations for a rise to 82.0.

Also on Friday, data revealed that the U.S. producer price index fell 0.1% in February, confounding expectations for a 0.2% rise, after a 0.2% increase the previous month.

Core producer price inflation, which excludes food and energy, slipped 0.2% last month, compared to expectations for a 0.1% rise, after a 0.2% gain in January.

Meanwhile, investors remained cautious after Russia launched new military exercises near its border with Ukraine, showing no sign of backing down on plans to annex Crimea.

U.S. Secretary of State John Kerry said the U.S. and Europe should take steps if a referendum on Crimea joining Russia takes place on Sunday as planned.

Markets also remained on edge after data on Thursday showed that Chinese industrial production rose 8.6% in the first two months of 2014, missing market expectations for an increase of 9.5%, while Chinese retail sales rose by a smaller-than-forecast 11.8% in the same period.

Leading Dow Jones Industrial Average performers included Boeing, up 1.01%, Home Depot, up 0.72%, and Coca-Cola, up 0.53%.

The Dow Jones Industrial Average’s worst performers included UnitedHealth, down 1.68%, JPMorgan, down 1.07%, and IBM, down 0.88%.

European indices, meanwhile, finished largely lower.

After the close of European trade, the EURO STOXX 50 fell 0.53%, France’s CAC 40 fell 0.80%, while Germany’s DAX 30 rose 0.43%. Meanwhile, in the U.K. the FTSE 100 fell 0.40%.

Forex

The dollar traded largely lower against most major currencies on Friday after a widely-watched gauge of consumer sentiment coupled with wholesale pricing data missed expectations.

In U.S. trading on Friday,EUR/USD was up 0.26% at 1.3904.

Friday’s U.S. economic data reminded investors that the Federal Reserve will take its time dismantling its monthly bond-buying program, which weakens the dollar as long as it remains in effect.

Meanwhile, investors remained cautious after Russia launched new military exercises near its border with Ukraine on Thursday, showing no sign of backing down on plans to annex Crimea.

U.S. Secretary of State John Kerry said the U.S. and Europe should take steps if a referendum on Crimea joining Russia takes place on Sunday as planned.

Kerry was set to meet with his Russian counterpart Sergei Lavrov on Friday in a last attempt to defuse tension between Moscow and the West.

Markets remained on edge after data on Thursday showed that Chinese industrial production rose 8.6% in the first two months of 2014, missing market expectations for an increase of 9.5%, while Chinese retail sales rose by a smaller-than-forecast 11.8% in the same period.

Meanwhile in Europe, Germany’s monthly inflation rate came in at 0.5% in February and 1.2% on year, both figures in line with market expectations.

Also in Europe, the European Union’s statistical arm Eurostat reported earlier that the number of employed individuals rose 0.1% in the fourth quarter of last year, beating market expectations for an unchanged reading.

The dollar was down against the yen, with USD/JPY down 0.49% at 101.31, and down against the Swiss franc, with USD/CHF down 0.21% at 0.8726.

The greenback was down against the pound, with GBP/USD up 0.04% at 1.6631.

The dollar was up against its cousins in Canada, Australia and New Zealand, with USD/CAD up 0.21% at 1.1097, AUD/USD down 0.06% at 0.9020 and NZD/USD down 0.11% at 0.8533.

The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.21% at 79.55.

GOLD

Gold prices traded higher on Friday as escalating tensions in Ukraine coupled with soft U.S. consumer sentiment data sparked demand for the yellow metal.

On the Comex division of the New York Mercantile Exchange, gold futures for April delivery traded at $1,377.80 a troy ounce during U.S. trading, up 0.39%, up from a session low of $1,368.30 and off a high of $1,388.80.

The April contract settled up 0.14% at $1,372.40 on Thursday.

Futures were likely to find support at $1,328.20 a troy ounce, Monday’s low, and resistance at $1,393.80, the high from Sept. 8.

Comex division of the New York Mercantile Exchange, gold futures for April delivery traded at $1,338.80 a troy ounce during U.S. trading, down 0.96%, up from a session low of $1,329.00 and off a high of $1,353.10.

Meanwhile, silver for May delivery was up 0.92% at US$21.392 a troy ounce, while copper futures for May delivery were up 0.90% at US$2.949 a pound.

Oil

Crude prices rose on Friday as tensions mounted in Ukraine, with fears brewing that a military standoff could disrupt global supply from Russia.

On the New York Mercantile Exchange, West Texas Intermediate crude for delivery in April traded at $98.53 a barrel during U.S. trading, up 0.34%. New York-traded oil futures hit a session low of $98.06 a barrel and a high of $99.25 a barrel.

The April contract settled up 0.21% at $98.20 a barrel on Thursday.

Nymex oil futures were likely to find support at $97.57 a barrel, Wednesday’s low, and resistance at $102.89 a barrel, last Friday’s high.

Crude posted cautious gains after oil-rich Russia launched new military exercises near its border with Ukraine on Thursday, showing no sign of backing down on plans to annex Crimea.

U.S. Secretary of State John Kerry said the U.S. and Europe should take steps if a referendum on Crimea joining Russia takes place on Sunday as planned.

Kerry was set to meet with his Russian counterpart Sergei Lavrov on Friday in a last attempt to defuse tension between Moscow and the West.

Soft consumer sentiment data in the U.S. watered down crude’s gains, as a more tepid U.S. economy will demand less fuel and energy going forward.

Elsewhere, on the ICE Futures Exchange in London, Brent oil futures for May delivery were up 1.08% and trading at US$108.08 a barrel, while the spread between the Brent and U.S. crude contracts stood at US$9.55 a barrel.

Natural Gas

Natural gas futures rose on Friday after bargain hunters snapped up nicely-priced positions in the commodity after bearish supply data sent prices falling to levels ripe for bottom fishing.

On the New York Mercantile Exchange, natural gas futures for delivery in April traded at $4.414 per million British thermal units during U.S. trading, up 0.70%. The commodity hit session high of $4.425 and a low of $4.342.

The April contract settled down 2.38% on Thursday to end at $4.383 per million British thermal units.

Natural gas futures were likely to find support at $4.342 per million British thermal units, the earlier low, and resistance at $4.732, Monday’s high.

The U.S. Energy Information Administration said in its weekly report on Thursday that natural gas storage in the U.S. in the week ended March 7 fell by 195 billion cubic feet, just shy of expectations for a decline of 196 billion cubic feet.

Supplies fell by 145 billion cubic feet in the same week a year earlier, while the five-year average is a decline of 95 billion.

The numbers sent prices dropping, though by Friday trading, investors viewed the commodity as oversold.

Gains were limited, however, as seasonably mild temperatures were expected to settle in the eastern U.S. in the coming days to mark spring’s arrival.

Updated weather-forecasting models called for above-normal temperatures across many densely populated areas in the U.S. in the next three to five days.

Spring and fall see the weakest demand for natural gas in the U.S, as the absence of extreme temperatures curbs the need for heating and air conditioning.

The heating season from November through March is the peak demand period for U.S. gas consumption. Approximately 52% of U.S. households use natural gas for heating, according to the Energy Department.