Written by Investing.com Staff, Investing.com
U.S. stocks lower at close of trade; Dow Jones Industrial Average down 2.02%
U.S. stocks were lower after the close on Friday, as losses in the Healthcare, Oil & Gas and Technology sectors led shares lower.
At the close in NYSE, the Dow Jones Industrial Average fell 2.02% to hit a new 6-months low, while the S&P 500 index fell 1.91%, and the NASDAQ Composite index fell 2.26%.
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The best performers of the session on the Dow Jones Industrial Average wereCaterpillar Inc (NYSE:CAT), which rose 0.69% or 0.87 points to trade at 126.77 at the close. Meanwhile, Procter & Gamble Company (NYSE:PG) added 0.16% or 0.15 points to end at 96.64 and Verizon Communications Inc (NYSE:VZ) was down 0.02% or 0.01 points to 57.08 in late trade.
The worst performers of the session were Johnson & Johnson (NYSE:JNJ), which fell 10.04% or 14.84 points to trade at 133.00 at the close. Walgreens Boots Alliance Inc (NASDAQ:WBA) declined 4.35% or 3.58 points to end at 78.74 and Cisco Systems Inc (NASDAQ:CSCO) was down 3.48% or 1.65 points to 45.82.
The top performers on the S&P 500 were Scana Corporation (NYSE:SCG) which rose 6.30% to 50.98, Sealed Air Corporation (NYSE:SEE) which was up 4.75% to settle at 33.94 and Public Storage (NYSE:PSA) which gained 2.22% to close at 203.47.
The worst performers were Johnson & Johnson (NYSE:JNJ) which was down 10.04% to 133.00 in late trade, Chesapeake Energy Corporation (NYSE:CHK) which lost 9.69% to settle at 2.330 and Costco Wholesale Corporation (NASDAQ:COST) which was down 8.59% to 207.06 at the close.
The top performers on the NASDAQ Composite were Cancer Genetics Inc (NASDAQ:CGIX) which rose 50.00% to 0.555, Alliqua BioMedical Inc (NASDAQ:ALQA) which was up 26.29% to settle at 2.690 and Marin Software Inc (NASDAQ:MRIN) which gained 18.29% to close at 3.040.
The worst performers were Idera Pharmaceuticals Inc (NASDAQ:IDRA) which was down 39.70% to 3.980 in late trade, Synergy Pharmaceuticals Inc (NASDAQ:SGYP) which lost 38.56% to settle at 0.080 and Advaxis Inc (NASDAQ:ADXS) which was down 36.82% to 0.24 at the close.
Falling stocks outnumbered advancing ones on the New York Stock Exchange by 2378 to 685 and 91 ended unchanged; on the Nasdaq Stock Exchange, 1999 fell and 642 advanced, while 77 ended unchanged.
Shares in Scana Corporation (NYSE:SCG) rose to 52-week highs; up 6.30% or 3.02 to 50.98. Shares in Chesapeake Energy Corporation (NYSE:CHK) fell to 52-week lows; losing 9.69% or 0.250 to 2.330. Shares in Procter & Gamble Company (NYSE:PG) rose to all time highs; up 0.16% or 0.15 to 96.64. Shares in Idera Pharmaceuticals Inc (NASDAQ:IDRA) fell to 52-week lows; falling 39.70% or 2.620 to 3.980. Shares in Synergy Pharmaceuticals Inc (NASDAQ:SGYP) fell to all time lows; down 38.56% or 0.050 to 0.080. Shares in Advaxis Inc (NASDAQ:ADXS) fell to all time lows; falling 36.82% or 0.14 to 0.24.
The CBOE Volatility Index, which measures the implied volatility of S&P 500 options, was up 4.75% to 21.63.
Gold Futures for February delivery was down 0.43% or 5.40 to $1242.00 a troy ounce. Elsewhere in commodities trading, Crude oil for delivery in January fell 2.62% or 1.38 to hit $51.20 a barrel, while the February Brent oil contract fell 1.92% or 1.18 to trade at $60.27 a barrel.
EUR/USD was down 0.50% to 1.1304, while USD/JPY fell 0.20% to 113.39.
The US Dollar Index Futures was up 0.41% at 97.455.
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The U.S. dollar was on track for weekly gain against its rivals Friday, as strong retail sales data affirmed the U.S. economy remains on a solid footing.
The U.S. dollar index, which measures the greenback against a trade-weighted basket of six major currencies, rose by 0.43% to 97.78.
The Commerce Department said on Wednesday that retail sales rose 0.2% last month, topping economists’ forecast for a 0.1% rise. The retail sales control group — which has a larger impact on U.S. GDP — rose 0.9%, above expectations for a 0.4% gain.
The strong retail sales print suggested consumer spending remained robust, pointing to signs of solid economic growth for the final quarter. RBC said in a note to clients:
“The strength of this number will surely force Q4 growth estimates higher. As for us, we went into this number looking for Q4 consumption of 3.2% and we will now take that to 3.5%. That takes Q4 GDP to 3.1% from 2.9%.”
The greenback was also supported by a slump in the pound to a 20-month low amid fears UK Prime Minister Theresa May’s failure to win key concessions from the European Union to support her Brexit deal could stifle economic growth.
GBP/USD fell 0.44% to $1.2580, but remain above its session low $1.2530.
EUR/USD fell 0.50% to $1.1304 after Eurozone PMI data fell short of estimates.
USD/CAD, meanwhile, rose 0.17% to C$1.3377.
USD/JPY fell 0.28% to Y113.31 as demand for safe-haven yen improved following a rout on Wall Street amid concerns over slowing global growth.
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It had to be one safe-haven or the other and the dollar triumphed at the expense of gold on Friday as signs of slowing growth in China sparked risk aversion across the globe.
A contrarian trade to bullion, the dollar hit 19-month highs after Beijing’s weakest retail sales performance in 15 years and smallest industrial output in almost three years cast doubts about demand in the No. 2 economy. Investors retreated from equity markets all over, putting Wall Street’s S&P 500 on track to a second weekly loss.
Benchmark COMEX gold futures for February settled down $6, or 0.5% at $1,241.40 per troy ounce. For the week, it was down almost 1%, its largest weekly loss in five.
The Dollar Index, which measures the greenback against six major currencies, was up 0.4% at 97.46 by 1:45 PM ET (18:45 GMT) after racing earlier to a May 2017 high of 97.715.
Walter Pehowich, executive vice-president at Dillon Gage Metals in Addison, Texas, said:
“The Wall Street gold traders I keep in touch with indicated they are all out of the gold market at this time, after being long from the $1,232 spot level and cashing out for the most part around the $1,240 level, as the dollar was seen gaining momentum.”
After a sluggish start to December, the dollar has picked up steam in recent days ahead of next week’s Federal Reserve policy meeting, where investors widely expect the central bank to announce a fourth rate hike for the year.
Investing.com‘s Fed Rate Monitor Tool has priced in a 79.2% chance of the central announcing a 2.00%-2.25% hike at the conclusion of its Dec. 19 policy meeting.
If that does take place, many also believe the Fed will pause on further hikes in the new year until there’s proof the economy is doing well enough to spur inflation. For now, dovish signals from various central bank speakers suggest the Fed isn’t convinced that data at hand warrants further tightening.
Fawad Razaqzada, technical analyst for forex and commodities at forex.com in London, said that after the December rate hike:
“We think there is a possibility that the days of the dollar’s reign as King of FX could be numbered.”
Such an outcome could be a boon for gold in the new year, especially with the fears abound over Brexit and a possible ouster of UK Prime Minister Theresa May due to the unpopularity of her divorce draft for U.K. from the European Union. Mike Hammer, author of “The Gold Enthusiast” blog, said on Friday:
“One thing is for sure, we are closer to the time when gold either breaks up-and-out or down-and-splash. We’ll be watching!”
In the trade of other precious metals on COMEX on Friday, silver slipped by 1.3% to $14.83 per ounce.
Palladium retreated by 1.9% to $1,168.40 per ounce, while sister metal platinum slipped 1.1% to $788.60.
In base metals, COMEX copper fell 0.3% to $2.76 per pound.
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Yo-yo days are back in oil, with the market falling as much in a day as it rose previously, as global growth fears offset bullish energy fundamentals.
After Thursday’s higher close of 2.8%, spurred by a surprise inventory drawdown at the delivery hub for U.S. crude, oil prices settled down almost that much on Friday as signs of slowing growth in China dampened hopes for demand.
China’s worse-than-expected retail sales saw their weakest growth in 15 years, while industrial output in the Asian giant rose the least amount in nearly three years, casting further doubt over demand from the world’s second-largest economy. The result was risk aversion across financial markets that put Wall Street’s S&P 500 on track to a second weekly loss.
Phil Flynn, senior market analyst at the Price Futures Group in Chicago, said:
“Trade war and recession fears are becoming part of our daily market swings.”
U.S. West Texas Intermediate crude settled down $1.38, or 2.6%, at $51.20 per barrel. It was down by a similar percentage on the week.
U.K. Brent, the global benchmark for crude, fell by $1.40, or 2.1%, to $60.05 by 2:48 PM ET (19:48 GMT)
Even a third-straight weekly drop in the U.S. oil rig count didn’t provide much help to oil.
U.S. drillers cut four rigs this week, adding to last week’s drop of 10 rigs, which were the most in more than two years, oil services firm Baker Hughes said in its closely-watched weekly data. Shale firms cut back on drilling activity after oil prices fell by a third over the past two months. Still, that didn’t stop the United States from briefly turning into a net oil exporter for the first time in history earlier this month.
Contrary to market expectations, oil prices have barely recovered since the Saudi-dominated OPEC, and its allies led by Russia, pledged last week to reduce a total of 1.2 million barrels per day from global supplies over the next six months, defying U.S. President Donald Trump, who had demanded that producers keep their crude flowing at the lowest prices possible.
With just about two weeks to the end of 2018, WTI remains down about 15% on the year and some 32% lower from four-year highs of nearly $77 per barrel hit in early October. Brent is down about 10% on the year and nearly 32% lower from four-year highs of nearly $87 per barrel hit two months ago.
See also:
- Crude Oil Weekly Price Forecast – oil continues to struggle (FXStreet)
- U.S. oil drillers cut rigs for second week in a row: Baker Hughes (Reuters)
Natural Gas (FXEmpire)
Natural gas markets broke down during the day on Friday, slicing through the $4.00 level which of course is a large come around, psychologically significant figure, and it now looks as if the momentum has completely shifted.
NATGAS Video 17.12.18
Christopher Lewis says:
I believe that at this point the market is starting to focus on warmer temperatures in the spring, so therefore I don’t have any interest in buying this market. Natural gas is over abundant in North America alone, so at this point I don’t think there’s any real sustainable bullish pressure in this market. Things got way ahead of themselves, and now we are starting to see reality to come back into this situation.
I’m looking for short-term bounces to start shorting yet again. I think that this will be a nice opportunity to sell this market every time we rally as there has been a massive amount of technical damage. The 50 day EMA of course is important, so I think some technical buying will come back, but I think that will be short-lived. As we roll over into Spring contracts, things will only get worse for pricing as traders, as traders will be focusing on the warmer temperatures.
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