Written by Investing.com Staff, Investing.com
U.S. stocks lower at close of trade; Dow Jones Industrial Average down 0.13%
U.S. stocks were lower after the close on Friday, as losses in the Industrials, Financials and Consumer Services sectors led shares lower.
At the close in NYSE, the Dow Jones Industrial Average fell 0.13%, while the S&P 500 index lost 0.13%, and the NASDAQ Composite index declined 0.24%.
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The best performers of the session on the Dow Jones Industrial Average were UnitedHealth Group Incorporated (NYSE:UNH), which rose 1.83% or 4.53 points to trade at 252.29 at the close. Meanwhile, Exxon Mobil Corp (NYSE:XOM) added 1.39% or 1.06 points to end at 77.67 and Verizon Communications Inc (NYSE:VZ) was up 0.78% or 0.45 points to 57.79 in late trade.
The worst performers of the session were Walt Disney Company (NYSE:DIS), which fell 1.24% or 1.76 points to trade at 140.26 at the close. Dow Inc (NYSE:DOW) declined 1.15% or 0.56 points to end at 48.37 and United Technologies Corporation (NYSE:UTX) was down 0.98% or 1.27 points to 128.76.
The top performers on the S&P 500 were Humana Inc (NYSE:HUM) which rose 4.47% to 270.39, Baker Hughes A Ge Company LLC (NYSE:BHGE) which was up 3.41% to settle at 25.19 and CarMax Inc (NYSE:KMX) which gained 3.13% to close at 85.60.
The worst performers were Carnival Corporation (NYSE:CCL) which was down 4.51% to 46.60 in late trade, Altria Group (NYSE:MO) which lost 4.50% to settle at 48.00 andSealed Air Corporation (NYSE:SEE) which was down 4.44% to 41.73 at the close.
The top performers on the NASDAQ Composite were Legacy Reserves Inc (NASDAQ:LGCY) which rose 59.77% to 0.0850, Aspen Group Inc (NASDAQ:ASPU) which was up 25.93% to settle at 5.1000 and China SXT Pharmaceuticals Inc (NASDAQ:SXTC) which gained 24.36% to close at 4.3400.
The worst performers were Akerna Corp (NASDAQ:KERN) which was down 25.99% to 27.05 in late trade, VERB TECHNOLOGY COMPANY INC (NASDAQ:VERB) which lost 18.33% to settle at 1.960 and Stellar Biotechnologies Inc (NASDAQ:EDSA) which was down 18.11% to 6.060 at the close.
Falling stocks outnumbered advancing ones on the New York Stock Exchange by 1830 to 1188 and 23 ended unchanged; on the Nasdaq Stock Exchange, 1591 fell and 1056 advanced, while 108 ended unchanged.
Shares in CarMax Inc (NYSE:KMX) rose to all time highs; rising 3.13% or 2.60 to 85.60.
The CBOE Volatility Index, which measures the implied volatility of S&P 500 options, was up 4.41% to 15.40.
Gold Futures for August delivery was up 0.45% or 6.30 to $1403.20 a troy ounce. Elsewhere in commodities trading, Crude oil for delivery in August rose 0.91% or 0.52 to hit $57.59 a barrel, while the August Brent oil contract rose 1.33% or 0.86 to trade at $65.31 a barrel.
EUR/USD was up 0.68% to 1.1368, while USD/JPY rose 0.02% to 107.31.
The US Dollar Index Futures was down 0.46% at 95.692.
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Canada stocks lower at close of trade; S&P/TSX Composite down 0.30%
U.K. stocks lower at close of trade; Investing.com United Kingdom 100 down 0.27%
The U.S. dollar remained near three-month lows on Friday as rising tensions between Iran and the U.S. and weaker-than-expected PMI data kept the dollar down.
The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, was down 0.1% to 96.047 by 10:54 AM ET (14:54 GMT).
Weakening manufacturing data on Friday increased support for the Federal Reserve cutting rates in July, with the preliminary purchasing managers index from Markit slipping towards the 50 contraction threshold.
The central bank signaled on Wednesday that they would be willing to cut rates in order to combat slowing global growth and cooling inflation, with investors pricing in a July rate cut at 100%.
Meanwhile, U.S. President Donald Trump said via Twitter that he had come within minutes of firing missiles at Iran in response to it shooting down a surveillance drone, increasing uncertainty over war in the region.
Tensions between the two countries have been fragile since the White House decided to withdraw from the UN-backed 2015 Iran nuclear agreement. The administration most recently accused Iran of last week’s attacks on oil tankers in the Persian Gulf, which Tehran denies.
The dollar rose against the safe haven Japanese yen, with USD/JPY up 0.4% to 107.66.
Elsewhere, the euro was stronger on the weak dollar, with EUR/USD up 0.3% to 1.1328, while GBP/USD slipped 0.2% to 1.2674 and USD/CAD rose 0.2% to 1.3213.
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The dream of gold bugs for $1,400 came true. And that’s prompting investors to wonder whether the yellow metal or oil will be best positioned to benefit from war cries in the Middle East and the Federal Reserve’s widely-expected rate cut.
Spot gold, reflective of trades in bullion, traded at $1,397.32 per ounce by 2:23 PM ET (18:23 GMT), up $8.91, or 0.6%, on the day. Bullion earlier peaked at $1,411.72, its highest since Sept. 2013. For the week, spot gold was up 4.4% while for the month, it showed a gain of 9.7%.
Gold futures for August delivery, traded on the Comex division of the New York Mercantile Exchange, settled Friday’s trade up $3.20, or 0.2%, at $1,400.10 per ounce. It earlier peaked at $1,414.95, its highest since Oct. 2013, when it rose to nearly $1,454. For the week, August gold was up 4.5%. For the month, it’s showing a gain of 10%. Mike Paulenoff, gold commentator at MPTrader.com, said:
“Should August gold climb and sustain above $1,420, my work will point to $1,445 to 1,450 as a minimum next target zone thereafter. This will argue that its multi-year upside breakout will continue unabated, perhaps in reaction to the combination of an easier Fed, a weaker USD, rising inflationary expectations and heightened geopolitical tensions.”
Some are talking of $1,500 levels and beyond if conflict in the Middle East reaches new heights after Thursday’s downing of a U.S. drone by Iran, and signs that the Fed could cut rates by 50 basis points or so by next month itself. Philip Streible, senior market strategist for precious metals at RJO Fututres in Chicago, said:
“$1,500 looks like the next big round target. Of course, there’s a lot of stop losses out there that need to happen first.”
Gold has been on an uptrend since the start of June, on speculation of a U.S. interest-rate cut. Earlier this week, the Federal Reserve opened the door for a possible rate cut in the future, sending the yield on the benchmark 10-year Treasury note below 2% – a key psychological level – for the first time since November 2016. Investing.com’s Fed Rate Monitor Tool sees a rate cut coming at the Fed’s July 30-31 meeting.
Lower interest rates make safe-haven assets such as gold, which does not yield interest, more attractive while weighing on the U.S. dollar. In Friday’s session, the dollar index, measured against a basket of six currencies, hit a three-month low of 95.76.
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Oil clinched its best week in 2-1/2 years on Friday, rising more than 9% on the week, as bulls kept up the rally in crude despite President Donald Trump’s about-turn on a military response to Iran.
New York-traded West Texas Intermediate crude settled up 36 cents, or 0.6%, at 57.43 a barrel. Combined with Thursday’s 5.5% rally and earlier gains, WTI finished the week up 9.4%. Its last-best finish was up 12.2% in the week to Nov. 27, 2016.
London-traded Brent crude, the benchmark for oil outside of the U.S., was up 74 cents, or 1.2%, at $65.19 per barrel by 2:50 PM ET (18:50 GMT). Brent gained more than 5% on the week, its most since the week ended Feb. 15.
Crude has staged a dramatic turnaround in the past 48 hours after Tehran’s Islamic Revolutionary Guard Corps said it shot down the U.S. RQ-4A Global Hawk surveillance drone, which it accused of incursion and spying over Iranian airspace. The Pentagon said that the aircraft, flying automatically and without a pilot, was in international airspace when it was targeted.
The drone was brought down not far from the congested and narrow Strait of Hormuz, used regularly by oil tankers and which Iran has threatened to block amid its showdown with the U.S.
Trump added to the fervor of the crude rally on Thursday when his first response to the drone matter was a tweet that simply said: “Iran made a very big mistake!” Yet, less than two hours later, the president clarified that he was referring to the the actions of a “stupid” individual Iranian general who made a “foolish” unintentional mistake.
Trump tweeted today that he was close to ordering a missile strike on Iran, but decided it was not proportional. Olivier Jakob of the PetroMatrix consultancy in Zug, Switzerland, said:
“In view of the 2020 elections, President Trump is facing a formidable challenge to address the military provocations of Iran, while avoiding a spike in gasoline prices and a correction of the stock market. The S&P 500 has been saved by the U.S. Federal Reserve, but the global economy is still suffering from the trade war and would be at risk of more suffering in a war over the Strait of Hormuz. However, this also means that large macro books need to have some oil length as a hedge to equity length.”
Oil bulls who chose to ignore the president’s apparent u-turn on Iran, instead cited a rejuvenated outlook for crude. Phil Flynn, senior market analyst at The Price Futures Group brokerage in Chicago, said:
“The death of oil demand is greatly exaggerated. All the doom and gloom over demand based on short term economic numbers masks the fact that things are not that bad.”
Crude’s rally could extend into the coming week if the U.S. Energy Information Administration issues another strong dataset on crude stockpiles and gasoline demand like last week.
The market could also see a sharp upside if Trump and his team hold, as he has promised, positive talks with China’s President Xi Jinping and negotiators from Beijing at the G20 meeting next weekend.
The never-ending mantra of production cuts by OPEC oil ministers as they head for their July 1-2 meeting in Vienna and more saber-rattling on Iran are among other things that could sprinkle some magic dust on the market.
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No report this week.
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