Written by Investing.com Staff, Investing.com
U.S. stocks mixed at close of trade; Dow Jones Industrial Average up 0.26%
U.S. stocks were mixed after the close on Friday, as gains in the Oil & Gas, Basic Materials and Financials sectors led shares higher while losses in the Consumer Services, Telecoms and Utilities sectors led shares lower.
At the close in NYSE, the Dow Jones Industrial Average added 0.26% to hit a new 1-month high, while the S&P 500 index climbed 0.09%, and the NASDAQ Composite index lost 0.25%.
Please share this article – Go to very top of page, right hand side for social media buttons.
The best performers of the session on the Dow Jones Industrial Average were Visa Inc (NYSE:V), which rose 3.81% or 5.14 points to trade at 140.15 at the close. Meanwhile, Exxon Mobil Corp (NYSE:XOM) added 3.60% or 2.64 points to end at 75.92 and Intel Corporation (NASDAQ:INTC) was up 3.42% or 1.61 points to 48.73 in late trade.
The worst performers of the session were Walmart Inc (NYSE:WMT), which fell 2.06% or 1.97 points to trade at 93.86 at the close. Caterpillar Inc (NYSE:CAT) declined 1.69% or 2.25 points to end at 130.91 and Microsoft Corporation (NASDAQ:MSFT) was down 1.58% or 1.65 points to 102.78.
The top performers on the S&P 500 were Symantec Corporation (NASDAQ:SYMC) which rose 8.99% to 22.91, FMC Corporation (NYSE:FMC) which was up 7.56% to settle at 85.83 and Aon PLC (NYSE:AON) which gained 7.19% to close at 167.46.
The worst performers were Amazon.com Inc (NASDAQ:AMZN) which was down 5.38% to 1626.23 in late trade, WestRock Co (NYSE:WRK) which lost 4.94% to settle at 38.70 and IDEXX Laboratories Inc (NASDAQ:IDXX) which was down 3.48% to 205.38 at the close.
The top performers on the NASDAQ Composite were TMSR Holding Company Ltd (NASDAQ:TMSR) which rose 122.58% to 5.52, Integrated Media Technology Ltd (NASDAQ:IMTE) which was up 36.59% to settle at 8.40 and Titan Pharmaceuticals Inc (NASDAQ:TTNP) which gained 34.15% to close at 1.6500.
The worst performers were Magnegas Applied Technology Solutions Inc (NASDAQ:MNGA) which was down 28.02% to 2.990 in late trade, OncoSec Medical Inc (NASDAQ:ONCS) which lost 24.99% to settle at 0.660 and Leap Therapeutics Inc(NASDAQ:LPTX) which was down 23.08% to 1.50 at the close.
Rising stocks outnumbered declining ones on the New York Stock Exchange by 1708 to 1304 and 107 ended unchanged; on the Nasdaq Stock Exchange, 1534 rose and 1094 declined, while 92 ended unchanged.
Shares in Aon PLC (NYSE:AON) rose to all time highs; rising 7.19% or 11.23 to 167.46. Shares in Magnegas Applied Technology Solutions Inc (NASDAQ:MNGA) fell to 52-week highs; falling 28.02% or 1.164 to 2.990. Shares in Leap Therapeutics Inc (NASDAQ:LPTX) fell to all time lows; down 23.08% or 0.45 to 1.50.
The CBOE Volatility Index, which measures the implied volatility of S&P 500 options, was down 2.60% to 16.14 a new 3-months low.
Gold Futures for April delivery was down 0.20% or 2.70 to $1322.50 a troy ounce. Elsewhere in commodities trading, Crude oil for delivery in March rose 2.92% or 1.57 to hit $55.36 a barrel, while the April Brent oil contract rose 3.34% or 2.03 to trade at $62.87 a barrel.
EUR/USD was up 0.15% to 1.1461, while USD/JPY rose 0.56% to 109.48.
The US Dollar Index Futures was unchanged at 95.300.
See also:
Stocks – Dow Notches 6-Week Winning Streak on Strong Jobs Report
Mexico stocks lower at close of trade; S&P/BMV IPC down 0.45%
Canada stocks lower at close of trade; S&P/TSX Composite down 0.18%
The U.S. dollar Friday was set to post a second week of losses in a row despite analysts downplaying expectations the Federal Reserve won’t hike rates this year after the economy created more jobs than expected last month.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, fell 0.03% to 95.55.
Nonfarm payrolls grew by 304,000 last month, up from 222,000 the prior month. The gain was well above economists’ forecast of 165,000.
The jobless rate unexpectedly ticked higher to 4% in January from 3.9% in December. Meanwhile, average hourly earnings slowed to a rate of 0.1%, below expectations for a 0.3% rise.
Analysts continued to tout a healthy backdrop for the labor market, saying the jobs report would strengthen the outlook for an interest rate hike this year. CIBC said:
“While it makes sense for the Fed to wait and see how its 2018 rate hikes impact the economy in the first half of this year, strong job creation and wage growth suggests consumer spending should still be robust and that policymakers should be able to hike rates once more this year.”
Elsewhere, EUR/USD rose 0.17% $1.1465 following data showing the pace of Eurozone inflation improved
GBP/USD fell 0.14% to $1.3082, while USD/CAD fell 0.38 to C$1.3076 as oil prices surged, propping up the loonie, following a fall in rig counts and signs that U.S. sanctions on Venezuelan exports have trimmed supply.
USD/JPY rose 0.62% to Y109.55 as demand for the safe-haven yen fell on the back of improving sentiment on trade.
President Donald Trump told reporters on Thursday he was confident “every point (on trade) will be agreed to” when he meets with President Xi Jinping at an as-yet-unscheduled date. The United States and China had their second-round of high level trade talks this week, and the U.S. trade team is expected to head to Beijing in mid-February for follow-up talks.
See also:
First it was palladium’s turn and now gold is racing to new highs above $1,300 an ounce, leaving other precious metals in the dust.
Gold chalked up its fifth-straight day of gains as January trading ended on Thursday, finishing higher for a fourth-straight month. That was also its best winning streak since April 2016.
In futures trading, gold’s benchmark April contract on the Comex division of the New York Mercantile Exchange hit 9-month highs of $1,330.15, before settling up $9.70 at $1,325.20. For the month, April gold rose by 3.4%.
The spot gold contract, reflective of trades in physical bullion, was down by a modest 37 cents at $1,319.34 by 4:00 PM ET (21:00 GMT), after making a nine-month high as well at $1,326.32. George Gero, analyst at RBC Wealth Management in New York, said:
“Gold is continuing to power above $1,300 as asset allocators are beginning to get more investors asking for precious metals exposure in their portfolios.”
Even so, some market pundits think gold will come off its highs soon and be trapped in a range.
A Reuters survey of 36 analysts and traders published on Tuesday showed the average median forecast for gold in 2019 at $1,305, only 3% above the 2018 average.
The poll concluded that a price breakout could be expected only in the coming year, with a high of $1,350 forecast for 2020. Even then, that will be below peaks of $1,374.91 seen in 2016 and $1,366.07 hit last year.
But gold’s momentum at the top seems to be telling a different story.
And some analysts are more bullish on the metal.
Standard Chartered (LON:STAN) precious metals analyst Suki Cooper recently told CNBC that she expects gold to average $1,325 by the fourth quarter of this year and even attempt to breach $1,400 in 2020. Gold has traded under $1,400 since September 2013.
The spot price of palladium traded at $1,342.85 per ounce, down $16.55, or 1.2%.
Spot palladium briefly traded above gold earlier this month when it hit record highs of $1,440.35 on Jan. 17, making it the world’s most valuable traded metal. Gold has hit even higher levels previously, rallying above $1,900 in 2011.
The most-active palladium futures contract on Comex fell by $10.25, or 0.8%, to $1,306.15 per ounce.
In other precious metals on Comex, silver futures gained 13 cents, or 0.8%, to $16.06 per ounce.
Platinum futures rose by $6.95, or 0.9%, to $823.15 per ounce.
In base metals, copper gained 1.4 cents, or 0.5%, to $2.78 per pound.
See also:
- U.S.-Sino Trade Optimism Stalls 5-Day Gold Rally
- Gold futures end lower, paring their weekly gain (MarketWatch)
On-and-off worries about the economy are off again, giving oil a bid after a huge jump in U.S. nonfarm payrolls.
New York-traded West Texas Intermediate crude and London’s Brent oil rose about 3% each on Friday as stocks on Wall Street surged on the U.S. employment report for January, which showed a growth of 304,000 jobs versus an estimated rise of 165,000.
WTI settled up $1.47, or nearly 3%, at $55.26 per barrel, after reaching a 10-week high of $55.37. For the week, it was up 3%, extending the 18.5% gain from last month, which was its best January on record.
Brent, the global oil benchmark, rose $1.96, or 3.2%, to $62.80 per barrel by 3:00 PM ET (20:00 GMT). It gained 2% for the week after January’s 15% rise, its best monthly rise since April 2016.
Oil was also aided somewhat by President Donald Trump’s offer to meet his Chinese counterpart Xi Jinping for a second time since December to keep alive a trade war truce that expires on March 1. Investors, however, also kept a nervous eye on China’s Caixin/Markit manufacturing index which hit 3-year lows, reportedly due to the impact of the trade war. Switzerland-based Petromatrix said in its daily note on oil:
“The stock market is still in a rising trend and that should translate into an increase of consumer confidence.”
Still, it expressed concerns that WTI “has not made a lot of flat price progress and not been able to break the long-standing range” in the second half of January despite its run to above $55 per barrel.
Crude prices rose through most of last week as the Trump administration imposed sanctions against Venezuelan oil amid data showing a deep slash in Saudi and OPEC crude exports to the U.S. The Federal Reserve’s decision not raise interest rates and also be patient with future tightening also bolstered risk appetite across markets.
But just when everything seemed fine and dandy for oil, OPEC also suffered a shock late in the week from its nemesis, U.S. shale, which once again showed it could crank out more oil than anyone predicted.
The U.S. Energy Information Administration’s latest estimate on shale production on Thursday showed the industry’s output had probably reached 11.9 million barrels per day as of November. In its Short-Term Energy Outlook report issued two weeks ago, the EIA had that same number as an estimate that will be achieved only in January. The revised outlook now means that the next STEO estimate on shale will be even higher. The EIA has a record production target of 13 million bpd for U.S. crude in 2020.
Oil bulls, however, got some reprive from the latest weekly reading on the U.S. oil rig count on Friday that showed a drop of 15 rigs to 847, demonstrating that the ramp up in shale activity wasn’t out of control. The rig count, published by industry firm Baker Hughes, has been volatile of last, rising by 10 last week after a drop of 21 the previous week.
See also:
- Oil Technical Analysis: WTI jumps above $55.00 a barrel (FXStreet)
- In One Chart: A ‘Fed put’ for stocks? Here’s a ‘Saudi put’ for oil prices (MarketWatch)
Natural Gas (ETF Daily News)
It’s business as usual in the energy pits, and traders continue to overreact to every piece of data. This week’s Energy Information Administration report showed a decline of 173 billion cubic feet in U.S. nat gas inventories. That decline brings the inventory level to 2.197 bcf, only 0.6% below the figure last year. After running well below last year’s and the five-year average level of inventories, withdrawals of natgas in the U.S. have slowed in recent weeks.
While it may seem as if a crisis was averted and the widespread natural gas shortages that seemed likely in October simply did not occur, I have to reiterate that is natural gas we are talking about. The figures released by the EIA are reported on a one week lag, and thus today’s report comprehended the data for the week ending January 25th.
Drilling down beyond the headline withdrawal figure, I looked into the EIA’s temperature data (sourced from NOAA) and found an interesting pattern. As of last Friday, the US had actually produced fewer heating degree days in the winter of 2018-2019 than it did last year. The US had produced only 214 heating degree days on a national average basis, 12 days below normal for this time of year and 14 days below last year’s figure. A sharp decline in each of the four Midwest subregions offset increases in the New England, Middle Atlantic and Pacific regions.
Remember though, those figures are reported with a one-week lag, and thus do not include this week’s record – and unfortunately fatal in several cases – cold across the Midwest.
Remember also the term heating degree days is meant as reference point, and is not an actual count of days. Since HDDs are based on a mean temperature of 65 degrees Fahrenheit and are usually calculated on a monthly aggregate, it is quite easy to accumulate a huge number of days during a cold snap. A day with a high of 10 degrees and a low of 0 would produce a heating degree day figure of 60, for instance. I think the folks in Chicago would take such a day about now.
So clearly the -70 degree Fahrenheit windchills experienced in Chicago are driving residential heating demand for natural gas. Also, reports of extraordinary residential demand in Minnesota – so much so that Xcel Energy advised consumers to turn down thermostats – increase my confidence that next week’s EIA HDD figures will have jumped back above normal levels for this time of year.
So, the forecast calls for cold temperatures in the Northeast again through Saturday and then a thaw into next week. As with any market, today’s natgas futures price should comprehend all of the current information, but its predictive value can be quite low. My old bones are telling me we will see at least one more chill this winter, bringing natgas supplies once again below their averages.
The way to play that, as I have learned through bitter experience, is not by buying stocks of natgas producers, but buying the commodity itself. If you don’t have access to futures trading, you can buy the UNG daily natgas tracker ETF issued by USCF, or if you are more aggressive, buy the 3x daily natgas tracker ETF, UGAZ, issued by VelocityShares. Also, if you disagree with me completely, instead of commenting on my posts on Twitter you could buy the 3x inverse natgas ETF, DGAZ, also issued by VelocityShares.
Don’t be a hero with such ETF trades, though. Always use limits on these trades and set stop losses. Most of all, stay warm!
The United States Natural Gas Fund L.P. (UNG) was trading at $24.73 per share on Friday afternoon, down $0.55 (-2.18%). Year-to-date, UNG has gained 6.05%, versus a 1.86% rise in the benchmark S&P 500 index during the same period.
UNG currently has an ETF Daily News SMART Grade of C (Neutral), and is ranked #52 of 108 ETFs in the Commodity ETFs category.
Note from the author:
In every column I have written about natural gas for Forbes I have referred to the natgas futures contract’s legendary status among energy traders. Yes, as I have mentioned before, the natgas contract is known as “the widowmaker” owing to its extraordinary volatility. That volatility has been in full force in the last three months as natgas futures jumped through $4.50/mmcf in November before moving back downward into the recent “normal” range of $3.00-$3.50/mmcf and have now taken another leg downward to sit at $2.83/mmcf as of this writing.
.
