Written by Investing.com Staff, Investing.com
U.S. stocks higher at close of trade; Dow Jones Industrial Average up 0.75%
U.S. stocks were higher after the close on Friday, as gains in the Basic Materials, Technology and Industrials sectors led shares higher.
At the close in NYSE, the Dow Jones Industrial Average added 0.75% to hit a new 1-month high, while the S&P 500 index added 0.85%, and the NASDAQ Composite index gained 1.29%.
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The best performers of the session on the Dow Jones Industrial Average were Apple Inc (NASDAQ:AAPL), which rose 3.31% or 5.06 points to trade at 157.76 at the close. Meanwhile, Caterpillar Inc (NYSE:CAT) added 3.11% or 4.13 points to end at 136.86 and DowDuPont Inc (NYSE:DWDP) was up 2.54% or 1.43 points to 57.76 in late trade.
The worst performers of the session were Intel Corporation (NASDAQ:INTC), which fell 5.47% or 2.72 points to trade at 47.04 at the close. McDonald’s Corporation (NYSE:MCD) declined 1.80% or 3.37 points to end at 184.00 and Walmart Inc (NYSE:WMT) was down 1.44% or 1.42 points to 96.94.
The top performers on the S&P 500 were Western Digital Corporation (NASDAQ:WDC) which rose 7.52% to 43.16, Seagate Technology PLC (NASDAQ:STX) which was up 6.57% to settle at 43.66 and Micron Technology Inc (NASDAQ:MU) which gained 6.48% to close at 38.96.
The worst performers were ResMed Inc (NYSE:RMD) which was down 19.39% to 94.56 in late trade, Pacific Gas & Electric Co (NYSE:PCG) which lost 15.63% to settle at 11.77 and AbbVie Inc (NYSE:ABBV) which was down 6.22% to 80.540 at the close.
The top performers on the NASDAQ Composite were HyreCar (NASDAQ:HYRE) which rose 28.81% to 4.56, TSR Inc (NASDAQ:TSRI) which was up 22.58% to settle at 6.100 and Check Cap Ltd (NASDAQ:CHEK) which gained 23.55% to close at 3.410.
The worst performers were Midatech Pharma PLC (NASDAQ:MTP) which was down 22.38% to 0.127 in late trade, Toughbuilt Industries Inc (NASDAQ:TBLT) which lost 16.25% to settle at 3.04 and Recon Technology Ltd (NASDAQ:RCON) which was down 15.83% to 1.010 at the close.
Rising stocks outnumbered declining ones on the New York Stock Exchange by 2307 to 718 and 101 ended unchanged; on the Nasdaq Stock Exchange, 1853 rose and 765 declined, while 87 ended unchanged.
Shares in Midatech Pharma PLC (NASDAQ:MTP) fell to all time lows; down 22.38% or 0.037 to 0.127.
The CBOE Volatility Index, which measures the implied volatility of S&P 500 options, was down 7.78% to 17.42 a new 1-month low.
Gold Futures for February delivery was up 1.75% or 22.35 to $1302.15 a troy ounce. Elsewhere in commodities trading, Crude oil for delivery in March rose 0.85% or 0.45 to hit $53.58 a barrel, while the March Brent oil contract rose 0.72% or 0.44 to trade at $61.53 a barrel.
EUR/USD was up 0.96% to 1.1414, while USD/JPY fell 0.14% to 109.47.
The US Dollar Index Futures was down 0.89% at 95.440.
See also:
Mexico stocks higher at close of trade; S&P/BMV IPC up 0.06%
Canada stocks higher at close of trade; S&P/TSX Composite up 0.54%
Stocks Rise on Earnings, Shutdown Deal (Bloomberg)
The U.S dollar suffered a weekly loss after falling sharply against its rivals Friday on expectations the Federal Reserve will turn more dovish at next week’s meeting, while a rally in the pound also weighed.
The U.S. dollar index, which measures the greenback against a trade-weighted basket of six major currencies, fell by 0.86% to 95.47.
The dollar came under pressure following a report from The Wall Street Journal that the Fed is closer than expected to ending its balance sheet unwind.
The Fed previously has been reluctant to elaborate on plans, if any, to end its balance sheet unwinding. But the slump in global markets late last year following the Fed’s decision to raise interest rates has seen the central bank lean more dovish.
In his press conference that followed the Fed’s December meeting, Fed Chairman Jay Powell said the central bank’s balance sheet trimming was on “autopilot.” But he walked back those comments soon after, reassuring investors the Fed would be flexible with all of its policy tools, including the balance sheet.
The report from the Wall Street Journal comes just days before the Federal Reserve meets for the first time this year. The Fed is expected to leave its benchmark rate unchanged, but traders will likely tune into Powell’s press conference for an insight into the central bank’s thinking on monetary policy.
The pound, meanwhile, continued to add to gains against the greenback on expectations that UK Prime Minister Theresa May’s Brexit “Plan B” will fare better than her initial withdrawal deal, which suffered a humiliating defeat in the U.K. Parliament on Jan. 15.
U.K. tabloid The Sun reported Friday that Northern Ireland’s DUP, which props up Theresa May’s government, has privately agree to support May’s Plan B, if it includes a clear time limit to the Irish backstop.
GBP/USD rallied 1.1% to $1.3202.
The euro pared some losses from a day earlier, when European Central Bank President Mario Draghi warned that euro area growth was waning.
EUR/USD rose 0.98% to $1.1415.
USD/JPY rose 0.09% to Y109.53 and USD/CAD was flat at C$1.3217 as the loonie was strengthen by rising oil prices, which limited gains in the pair.
See also:
The conviction the Fed won’t be raising rates anytime soon is pushing the dollar down and jacking spot gold back around the key $1,300 level.
The seven-month highs in bullion’s price on Friday was accompanied by a rally in palladium, although the auto-catalyst metal fell short of making new all-time highs above $1,400 per ounce.
The spot price of gold traded at $1,297.94 per ounce by 1:00 PM ET (18:00 GMT), after reaching $1,300.33 earlier, its highest since June.
On the New York Mercantile Exchange’s Comex division, the most-active gold futurescontract gained $17.25, or 1.4%, to $1,297.05 per ounce. The session peak was $1,299.65. Since hitting its own highs of above $1,300 on Jan. 4, Comex gold has traded in a band of $10 to $15 under that peak.
The dollar index, a contrarian trade to precious metals, slid on expectations that next week’s Federal Reserve meeting will not yield another rate hike like in December. Fed funds futures are pricing in a 98% chance that the FOMC keeps rates steady, according to Investing.com’s Fed Rate Monitor Tool.
The Fed raised rates four times last year but Fed Chairman Jerome Powell has since indicated a willingness to be “patient” with tightening based on economic performance. Other Fed governors have also been dovish.
Further weighing on the dollar was the euro, which rose after the European Central Bank said it will delay, but not do away with, the bloc’s eventual rate hike. The yuan also rose on hopes of an imminent resolution to the U.S.-Sino trade dispute. Fawad Razaqzada, analyst at forex.com, said:
“The fact that gold has so far refused to go down meaningfully from around the $1295-$1300 resistance area suggests that the selling pressure has not been strong as some would have expected from around this key hurdle. So, as things stand, gold looks poised for another potential breakout above $1300, which could then lead to further technical follow-up buying pressure in early next week.”
The spot price of palladium traded at $1,360.50 per ounce, up $37.60, or 2.8%. The session peak was $1,362.95.
Spot palladium hit all-time highs of $1,440.35 on Jan. 17, making it the world’s most valuable traded metal currently, although gold had reached record highs above $1,900 previously.
The most-active palladium futures contract on Comex jumped $38.80, or 3%, to $1,319.50 per ounce.
In other metals trading on Comex, silver futures gained 37 cents, or 2.4%, to $15.67 per ounce.
Platinum futures rose by $13.50, or 1.7%, to $818.50 per ounce.
In base metals,copper climbed 8 cents, or 3%, to $2.72 per pound.
See also:
- Gold breaks the $1,300 level, as dollar weakens (ETF Daily News)
- Gold ends sharply higher for the session, up over 1% for the week (MarketWatch)
A short-lived drop in rigs and record gasoline stockpiles aren’t deterring oil bulls, who continue counting on the possibility of U.S. sanctions on Venezuelan oil to take the market higher.
New York-traded West Texas Intermediate and London’s Brent crude were both up about 1% after oil services firm Baker Hughes reported a rise of 10 U.S. oil rigs this week, versus last week’s drop of 21.
WTI settled up 53 cents, or 1%, at $53.69 per barrel.
Brent, the global oil benchmark, climbed by 47 cents, or 0.8%, to $61.56 by 2:45 PM ET (18:45 GMT).
For the week, WTI was down about 0.3 % while Brent showed a decline of nearly 2%.
Oil prices have been mixed this week, initially tumbling on weak Chinese and global data and concerns about the U.S. oil stockpiles, before being supported by fears that the U.S. could slap sanctions against Venezuelan oil in retaliation against President Nicholas Maduro’s decision to sever diplomatic ties with Washington.
The rig count from Baker Hughes is crucial to determining whether output of U.S. shale crude, which has been responsible for two supply gluts in global oil markets the past four years, is slowing (at least in the near term).
Last week’s drop of 21 U.S. oil rigs took traders by surprise, accelerating prices gains in a market already charging higher on OPEC’s aggressive campaign to publicize its production cuts. But while last week’s slide was the sharpest in nearly three years, the 862 oil rigs deployed as of this week is still higher than the year-ago level of 747.
In its weekly supply-demand update published on Thursday, the U.S. Energy Information Administration announced a larger-than-expected build of 4.05 million barrels in gasoline stockpiles to a record high 259.6 million barrels. Analysts had only expected a gasoline build of 2.66 million barrels last week.
Crude inventories rose by 7.97 million barrels in the week to Jan. 18, compared to forecasts for a stockpile draw of 0.042 million barrels, the EIA said.
Inventories of distillates, which produce diesel and other commercial fuels, decreased by 0.62 million barrels, compared to forecasts for a decline of 0.23 million.
As for Venezuela, the U.S. has drafted a slate of potential restrictions on the Latin American nation’s crude exports, but hasn’t decided whether to deploy them, said people familiar with the matter. The crisis in Caracas could expedite OPEC’s goals of balancing the supply-demand in oil and boosting crude prices or risk market havoc.
But analysts doubt the Trump administration would go ahead with the sanctions as they could starve U.S. refineries of Venezuela’s sour-grade oil, which is crucial for producing diesel, jet and other commercial fuels, compared to WTI’s sweet grade meant for gasoline.
Prices of crude and all fuels could also surge as a result of the sanctions, something President Donald Trump would particularly dislike, analysts say.
See also:
- Venezuelan oil exports to U.S. still a primary source of cash (Reuters)
- U.S. drillers add rigs this week, but cut most in a month since 2016: Baker Hughes (Reuters)
Natural Gas (FXEmpire)
If the price action is limited today then this will indicate traders may be willing to wait a few days for the updated forecast. The key concern for bullish traders is the forecast for after February 4 since recent forecasts are calling for a possible break in cold temperatures.
Natural gas futures are trading higher on Friday, but backing off from earlier highs as traders continue to react to Thursday’s government report showing a slightly-larger-than-expected storage build, while focusing on the forecasts calling for another wave of polar vortex cold. Additionally, traders continue to toy with a key technical area that appears to be exerting a strong influence on the direction of the market.
At 1008 GMT, March natural gas futures are trading $3.013, up $0.015 or +0.56%.
U.S. Energy Information Administration Storage Report
On Thursday, the EIA reported a 163 Bcf withdrawal for the week-ending January 18. This number was mixed. While falling on the bullish side of the weekly estimates, it failed to impress when compared to the five-year average which came in at 183 Bcf. It was also well-below last year’s 273 Bcf withdrawal for the same period a year ago.
Short-Term Weather Forecast
According to NatGasWeather for the period January 25 to 31:
“A strong cold blast will sweep across the Midwest and East into the weekend with lows dropping into the -10s to 20s for very strong demand. A brief break will follow to start next week ahead of the strongest polar blast in the series Tuesday through Friday where lows will drop into the -30s to 20s for very strong demand. The West will see a mix of mild, cool, and cold. Overall, national demand will be high to very high.”
Mid-Term Weather Forecast
According to Bespoke Weather Services:
“February gas prices are not particularly impressed with this number (EIA report), but with cold weather only confined to the East on the week and a large draw both in the Midwest and in the South Central we see this print as indicating significant upside risk on any return of colder weather into the middle of February.”
Forecast
The early price action suggests investors are trying to build another higher bottom at $2.897. The other bottoms are $2.809 and $2.771.
The short-term range is $2.809 to $3.406. The key area controlling the direction of the market is $3.089 to $3.014. The bias should shift to the upside if buyers can overcome and sustain a rally over $3.089. The bias will remain to the downside on a sustained move under $3.014.
Holding between $3.014 and $3.089 will indicate investor indecision and impending volatility.
If the price action is limited today then this will indicate traders may be willing to wait a few days for the updated forecast. The key concern for bullish traders is the forecast for after February 4 since recent forecasts are calling for a possible break in cold temperatures
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