Written by Investing.com Staff, Investing.com
U.S. stocks mixed at close of trade; Dow Jones Industrial Average down 0.25%
U.S. stocks were mixed after the close on Friday, as gains in the Consumer Goods, Utilities and Telecoms sectors led shares higher while losses in the Oil & Gas, Consumer Services and Financials sectors led shares lower.
At the close in NYSE, the Dow Jones Industrial Average declined 0.25%, while the S&P 500 index gained 0.07%, and the NASDAQ Composite index climbed 0.14%.
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The best performers of the session on the Dow Jones Industrial Average were United Technologies Corporation (NYSE:UTX), which rose 1.47% or 1.77 points to trade at 122.49 at the close. Meanwhile, Pfizer Inc (NYSE:PFE) added 1.27% or 0.53 points to end at 42.23 and Cisco Systems Inc (NASDAQ:CSCO) was up 1.05% or 0.49 points to 47.19 in late trade.
The worst performers of the session were UnitedHealth Group Incorporated (NYSE:UNH), which fell 2.64% or 7.10 points to trade at 261.90 at the close. Walgreens Boots Alliance Inc (NASDAQ:WBA) declined 1.52% or 1.08 points to end at 70.12 and Walmart Inc (NYSE:WMT) was down 1.19% or 1.15 points to 95.58.
The top performers on the S&P 500 were Coty Inc (NYSE:COTY) which rose 32.15% to 9.33, Mattel Inc (NASDAQ:MAT) which was up 23.22% to settle at 15.23 andElectronic Arts Inc (NASDAQ:EA) which gained 16.05% to close at 97.60.
The worst performers were The Goodyear Tire & Rubber Company (NASDAQ:GT) which was down 9.05% to 18.69 in late trade, Henry Schein Inc (NASDAQ:HSIC) which lost 5.31% to settle at 59.15 and Hanesbrands Inc (NYSE:HBI) which was down 4.65% to 17.84 at the close.
The top performers on the NASDAQ Composite were eGain Corporation (NASDAQ:EGAN) which rose 47.72% to 10.990, Marathon Patent Group Inc (NASDAQ:MARA) which was up 35.53% to settle at 0.515 and Eyenovia Inc(NASDAQ:EYEN) which gained 28.05% to close at 6.30.
The worst performers were Cellect Biotechnology Ltd (NASDAQ:APOP) which was down 49.78% to 1.15 in late trade, Magnegas Applied Technology Solutions Inc (NASDAQ:MNGA) which lost 48.17% to settle at 0.990 and Biocept Inc (NASDAQ:BIOC) which was down 47.29% to 1.070 at the close.
Falling stocks outnumbered advancing ones on the New York Stock Exchange by 1587 to 1416 and 109 ended unchanged; on the Nasdaq Stock Exchange, 1343 fell and 1271 advanced, while 100 ended unchanged.
Shares in The Goodyear Tire & Rubber Company (NASDAQ:GT) fell to 5-year lows; down 9.05% or 1.86 to 18.69. Shares in Henry Schein Inc (NASDAQ:HSIC) fell to 5-year lows; losing 5.31% or 3.32 to 59.15. Shares in Cellect Biotechnology Ltd (NASDAQ:APOP) fell to all time lows; falling 49.78% or 1.14 to 1.15. Shares in Magnegas Applied Technology Solutions Inc (NASDAQ:MNGA) fell to 3-years lows; falling 48.17% or 0.920 to 0.990.
The CBOE Volatility Index, which measures the implied volatility of S&P 500 options, was down 3.97% to 15.72.
Gold Futures for April delivery was up 0.27% or 3.55 to $1317.75 a troy ounce. Elsewhere in commodities trading, Crude oil for delivery in March rose 0.13% or 0.07 to hit $52.71 a barrel, while the April Brent oil contract rose 0.75% or 0.46 to trade at $62.09 a barrel.
EUR/USD was down 0.14% to 1.1324, while USD/JPY fell 0.04% to 109.75.
The US Dollar Index Futures was up 0.13% at 96.415, 1.19% higher for the week.
See also:
Canada stocks lower at close of trade; S&P/TSX Composite down 0.45%
What are the Chances of a S&P 500 Reversal, EURUSD Breakout, Gold Trend Next Week? (Dailyfx)
S&P 500 first-quarter earnings seen declining from year earlier: Refinitiv data (Reuters)
The U.S dollar is on track to snap a two-week losing streak Friday as safe-haven buying set in on expectations the U.S.-Sino trade war could turn ugly in the coming weeks.
The U.S. dollar index, which measures the greenback against a trade-weighted basket of six major currencies, rose by 0.13% to 96.415.
The dollar saw fresh support on fears the U.S. and China are set to resume, or worst yet escalate their trade war in the coming weeks as Washington reportedly will not back away from plans to ramp up tariffs on China in the absence of a trade deal by March 1.
The U.S. has slapped tariffs on $250 billion worth of Chinese goods, about half the value of U.S. imports from the country. China has hit back with tariffs on $110 billion worth of American exports.
Wall Street also drummed up support for the dollar pointing out that it will take more than a “dovish” Federal Reserve to keep a lid on the greenback. Goldman Goldman Sachs said:
“Further dollar downside most likely requires a combination of slower U.S. growth and better non-U.S. growth — a dovish Fed may not be quite enough.”
Elsewhere, a weaker euro and pound also lent support to the dollar.
EUR/USD fell 0.13% to $1.1325 and GBP/USD fell 0.15% to $1.2934.
USD/JPY rose 0.15% to Y109.84
USD/CAD fell 0.28% to $1.3268 as the loonie was underpinned by stronger-than-expected housing and labor market data.
Analysts on Wall Street said the strong economic data from Canada could nudge the Bank of Canada toward a rate hike, but conceded a weaker backdrop for the energy sector would likely weigh on growth. TD Securities said:
“The data should help support the Bank of Canada’s bias towards higher rates, although the weakness across the energy sector and Alberta provide evidence of the headwinds to the economy in first quarter.”
See also:
The missed U.S-China summit opportunity may be good for gold. The only trouble is the dollar is rallying on that, too, as the greenback has become a hedge to trade troubles as well. That has capped gold’s safe-haven potential.
Both bullion and gold futures were on the positive side of $1,300 for the first time in six sessions on Friday, reacting to news that U.S. President Donald Trump will not meet with Chinese counterpart Xi Jinping before the March 1 deadline to sign a trade deal.
The spot gold contract, reflective of trades in physical bullion, was up $4.35, or 0.3%, at $1,314.47 per ounce by 3:46 PM ET (20:46 GMT).
In futures trading, gold’s benchmark April contract on the Comex division of the New York Mercantile Exchange settled up $4.30, or 0.3%, to $1,318.50 per ounce.
For the week, both the spot price and futures of gold were down 0.3%.
The lack of a meeting between Trump and Xi had dampened hopes for a smooth resolution to the U.S.-China trade war, one of the most intense rivalries of this generation. Both U.S. Treasury Secretary Steven Mnuchin and Trade Representative Robert Lighthizer are still expected in China next week for another round of talks to avert an increase in U.S. tariffs on Chinese goods.
Shusuke Yamada, chief Japan FX and equity strategist at Bank Of America Merrill Lynch, said:
“Investors are getting nervous as the market had been optimistic about a resolution of the trade dispute since the beginning of the year.”
Gold futures hit highs above $1,300 for five-consecutive sessions through Jan. 31, peaking at $1,331.10, as investors raised their stakes in the yellow metal amid Fed reassurances that it will be patient with rate hikes. That rally was followed by five
The dollar also rallied Friday on the missed summit opportunity. Trade uncertainty tends to support the dollar, which is considered a safe haven in light of trade tensions.
The dollar index, which tracks the greenback against a basket of other major currencies, rose for the fifth week in a row. Prior to the renewed worries over China, the dollar had been under pressure from the Fed’s patient stance.
Palladium remained the world’s most valuable traded metal, with its spot price trading at $1,404.20 per ounce, up $18.10, or 1.3% on the day.
Spot palladium first traded above gold last month when it hit record highs of $1,440.35 on Jan. 17. Gold’s own peaks have been higher in the past, rallying above $1,900 in 2011.
Trades in other Comex metals as of 12:14 PM ET (17:14 GMT):
Palladium futures up $19.50, or 1.4%, at $1,377.60 per ounce.
Silver futures up 10.9 cents, or 0.7%, at $15.82 per ounce.
Platinum futures up $4.60, or 0.6%, at $801.90 per ounce.
Copper futures down 1.9 cents, or 0.6%, at $2.81 per pound.
See also:
- Precious Metals, Miners ETFs Shine on Renewed Fear Trade (ETF Trends)
- Gold futures end higher, but post a loss for the week (MarketWatch)
Trade wars, slowing global growth and uncertainty over how quickly Venezuelan sanctions will bite are all coming together to hobble oil’s rebound.
New York-traded West Texas Intermediate crude settled modestly higher on Friday but lost almost 5% on the week. London’s Brent oil also rose on the day and fell on the week as the U.S. and China missed an opportunity to hold a summit to settle their trade war before a March 1 deadline.
Struggling euro zone economies, the slow-burn crisis in Venezuela and a volatile U.S. rig count were other factors that dented the outlook for oil.
WTI settled up 8 cents, or 0.2%, on the day at $52.72 per barrel. For the week, it fell 4.6%, its steepest weekly decline year-to-date, despite scaling November highs of $55.75 earlier in the week.
Brent, the global oil benchmark, was up 40 cents, or 0.7, at $62.03 per barrel by 3:25 PM ET (20:35 GMT). For the week, it was down 1.2%, after scaling 2019 highs of $63.63 earlier in the week.
The weekly reading on the U.S. oil rig count published by industry firm Baker Hughesshowed a rise of 7 units to 854. Last week, the rig count dropped by 14, taking the count to a nine-month low of 847. Analysts said rig additions could quickly multiply if WTI prices stayed not far from $55 a barrel.
Crude prices came under renewed pressure this week after U.S. President Donald Trump said there would be no talks between him and Chinese President Xi Jinping before the deadline for a trade deal on March 1, raising new concerns about trade tensions between the world’s two biggest economies. Last week, Trump suggested that he would sit with Xi in late February, but on Thursday he ruled out such a meeting.
Lower growth forecasts by the European Union from earlier this week had heightened fears of a global economic slowdown.
In Venezuela’s case, two weeks after opposition leader Juan Guaido declared himself interim president in defiance of sitting leader Nicolas Maduro, the standoff between the two has settled into a kind of stasis. While dozens of countries have recognized Guaido, Maduro continues to control the Venezuelan state apparatus, including the military. New York-based consultancy Energy Intelligence said in its weekly note:
“For now, the competing presidents appear to be mustering allies and trying to determine their next moves, and a prolonged stalemate is likely.”
The stalemate also means the sanctions imposed by the Trump administration on the Maduro-controlled PDVSA oil company have had limited impact on crude prices so far.
Trump is counting on Saudi Arabia’s help to fill any oil supply gap caused by the sanctions on PDVSA while trying to prevent Saudi-controlled Organization of Petroleum Exporting Countries from formalizing a pact with Russia that would lift crude prices.
A bipartisan group of U.S. senators have put together a bill for the Justice Department to sue members of OPEC for antitrust violations if the cartel tries to formalize its oil cooperation pact with Russia.
At the same time, refiners on the U.S. Gulf Coast, squeezed by the absence of Venezuelan oil, have been told by White House officials not to expect any crude release from the Strategic Petroleum Reserve. Citing an administration source, energy reporting service Platts reported Thursday that officials are “certain” the Saudis will boost crude exports to the U.S. in coming weeks.
What makes the U.S. position remarkable, Platts pointed out, is that Saudi officials have indicated no plans of making up for any shortfall in Venezuelan supply, as the OPEC cartel under their control has been busily cutting output to boost prices.
See also:
- Trump official slams cartels as U.S. lawmakers push anti-OPEC bill (Reuters)
- Latin American oil prices, flows to U.S. jump amid PDVSA restrictions (Reuters)
Natural Gas (ETF Daily News)
This week, gas prices have fallen further, with the market closing today down 11 cents to $2.55 per MMBtu for prompt month (March).
It was indeed remarkable that the U.S. natural gas market saw the lowest prices since July last week despite Polar Vortex 2019. In particular, given that gas demand peaks in the Winter when heating and power generation needs collide, the U.S. hit an all-time record of 150 Bcf/d of consumption.
With still a week to go before Valentine’s Day, this is absolutely incredible.
Technically, there are two seasons for the U.S. gas market: Summer (April-Oct) and Winter (November-March). Gas is injected into the ground in Summer and gas is withdrawn in Winter to meet demand that rises well above production.
This two-tier system for our gas market, however, is obviously oversimplified.
In reality, the U.S. gas market is more of a triad, Summer, Winter, and Shoulder season (Fall, Spring). The Shoulder season has lower gas demand because milder weather means less air conditioning than Summer and less heating than Winter.
So increasingly, already favored because it has lower greenhouse gas emissions to combat climate change, natural gas wins regardless of which direction our climate goes: scorching summers devour gas for power and frigid winters devour gas for heating.
In addition, increasingly so, gas is now our main source of electricity, at 33-35% of total generation, and electricity is our fastest way to heat homes, pointing the arrow even more toward “gas, gas, and more gas.”
So the question: are U.S. natural gas prices seasonal?
As we continue to use more gas for power, heating, manufacturing, and exporting, this is a critical question.
Lower prices in Winter like we saw during Polar Vortex 2019 are not as uncommon as most gas market watchers probably realize. When looking from 2011-2018, a few things can generally be said about natural gas prices, but the seasonality of prices is not as apparent as one might think.
Yes, generally speaking, U.S. gas prices are higher and more volatile during peak demand months in Winter and lower and less volatile during the Fall.
But, as the graphic below shows, seasonal differences overall are not so clear.
A few other points on gas prices to remember. Since our shale revolution took flight in 2008, with production up nearly 55%, natural gas has become lower and more stably priced. Yet somehow, despite record production, U.S. gas prices since November have spiked to their highest volatility since 2009.
Choppy and erratic, current winter gas prices in November hit their highest level since 2014, only to close today at their lowest level since last February 12. Note: there is very strong technical support at $2.51, however, and I do indeed expect an upward correction. That mid-$2.50s level has held very strongly in recent years.
As the U.S. gas market continues to rapidly grow, become more complex, and be forced to absorb booming exports, there are just too many factors to predict gas prices based on month or season. For example, take Shoulder month May 2017, when the massive 3.25 Bcf/d Rover pipeline being suspended impacted national prices: “A Single Pipeline’s Taking U.S. Gas on a Rollercoaster Ride.“
LNG exports especially are adding a new dynamic to our market that are likely to affect domestic Winter pricing most. Colder weather abroad will typically translate into more U.S. supply leaving the country. As the U.S. export complex continues to mushroom, with capacity nearly tripling this year to over 10 Bcf/d (~12% of current U.S. gas production), exports will put a floor under our own pricing, with the potential to increase prices and volatility.
To illustrate, the sustained price collapse during the first half of 2016 is becoming increasingly less likely because other nations are gaining greater access to our gas, and they will be more than willing to purchase it as prices fall, thereby pushing our prices up again.
The ultimate impact of huge LNG exports, there is an astounding 55 Bcf/d of potential U.S. LNG capacity now under FERC review, is somewhat unpredictable because they will be a completely new phenomenon. There is almost no way to fully model today the domestic impact – good or bad – of the U.S. possibility becoming the world’s largest LNG supplier within five to seven years. It is a completely unprecedented achievement.
But to be clear, we should never underestimate the ability of the U.S. shale industry to adequately respond to a massive amount of gas leaving the country for other nations. With at least a 100-year domestic shale gas supply, a pertinent truism to remember: “more exports (i.e., more demand) beget more production.”
In any event, we will be devouring lots more natural gas regardless of what its price is.
We are increasingly installing a very low price elasticity of demand for natural gas
Gas is surging toward being 50% of all U.S. electricity capacity and intermittent renewables simply cannot compensate for ongoing coal and nuclear retirements.
In fact, gas is the required backup for wind and solar themselves when there is no wind or sun, something that happens more frequently than people in the renewable energy business care to admit.
Not to mention that we have over a $200 billion build-out in new manufacturing plants that are specifically configured to utilize U.S. shale gas.
The United States Natural Gas Fund L.P. (UNG) was trading at $23.05 per share on Friday afternoon, up $0.10 (+0.44%). Year-to-date, UNG has declined -1.16%, versus a 1.14% 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.
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