Written by Investing.com Staff, Investing.com
U.S. stocks higher at close of trade; Dow Jones Industrial Average up 0.80%
U.S. stocks were higher after the close on Friday, as gains in the Healthcare, Technology and Telecoms sectors led shares higher.
At the close in NYSE, the Dow Jones Industrial Average gained 0.80% to hit a new all time high, while the S&P 500 index climbed 0.77%, and the NASDAQ Composite index added 0.73%.
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The best performers of the session on the Dow Jones Industrial Average were UnitedHealth Group Incorporated (NYSE:UNH), which rose 5.30% or 13.57 points to trade at 269.40 at the close. Meanwhile, Johnson & Johnson (NYSE:JNJ) added 3.04% or 3.98 points to end at 134.94 and Pfizer Inc (NYSE:PFE) was up 2.00% or 0.73 points to 37.28 in late trade.
The worst performers of the session were Walt Disney Company (NYSE:DIS), which fell 1.69% or 2.48 points to trade at 144.67 at the close. Walmart Inc (NYSE:WMT) declined 1.48% or 1.78 points to end at 118.87 and The Travelers Companies Inc (NYSE:TRV) was down 0.28% or 0.38 points to 133.57.
The top performers on the S&P 500 were Applied Materials Inc (NASDAQ:AMAT) which rose 8.95% to 62.06, Anthem Inc (NYSE:ANTM) which was up 5.61% to settle at 297.82 and Humana Inc (NYSE:HUM) which gained 5.52% to close at 335.55.
The worst performers were CenterPoint Energy Inc (NYSE:CNP) which was down 4.53% to 25.48 in late trade, Whirlpool Corporation (NYSE:WHR) which lost 3.74% to settle at 144.36 and Corteva Inc (NYSE:CTVA) which was down 3.41% to 25.4800 at the close.
The top performers on the NASDAQ Composite were Senmiao Technology Ltd (NASDAQ:AIHS) which rose 154.82% to 1.07, TKK Symphony Acquisition Corporation (NASDAQ:TKKS) which was up 65.63% to settle at 10.22 and Akerna Corp (NASDAQ:KERN) which gained 56.30% to close at 5.94.
The worst performers were resTORbio Inc (NASDAQ:TORC) which was down 86.29% to 1.09 in late trade, Yield10 Bioscience Inc (NASDAQ:YTEN) which lost 44.55% to settle at 0.150 and Agile Thrpe (NASDAQ:AGRX) which was down 37.40% to 1.49 at the close.
Rising stocks outnumbered declining ones on the New York Stock Exchange by 1762 to 1041 and 114 ended unchanged; on the Nasdaq Stock Exchange, 1532 rose and 1112 declined, while 90 ended unchanged.
Shares in Applied Materials Inc (NASDAQ:AMAT) rose to all time highs; gaining 8.95% or 5.10 to 62.06. Shares in CenterPoint Energy Inc (NYSE:CNP) fell to 52-week lows; losing 4.53% or 1.21 to 25.48. Shares in Humana Inc (NYSE:HUM) rose to 52-week highs; rising 5.52% or 17.55 to 335.55. Shares in resTORbio Inc (NASDAQ:TORC) fell to all time lows; down 86.29% or 6.86 to 1.09. Shares in Yield10 Bioscience Inc (NASDAQ:YTEN) fell to all time lows; down 44.55% or 0.120 to 0.150.
The CBOE Volatility Index, which measures the implied volatility of S&P 500 options, was down 7.66% to 12.05 a new 6-months low.
Gold Futures for December delivery was down 0.32% or 4.65 to $1468.75 a troy ounce. Elsewhere in commodities trading, Crude oil for delivery in December rose 1.96% or 1.11 to hit $57.88 a barrel, while the January Brent oil contract rose 1.70% or 1.06 to trade at $63.34 a barrel.
EUR/USD was up 0.29% to 1.1053, while USD/JPY rose 0.33% to 108.75.
The US Dollar Index Futures was down 0.17% at 97.857.
See also:
Market Extra: Dow closes above 28,000 – marks first milestone finish in 90 trading days (MarketWatch)
The U.S. dollar fell on Friday, after data showed that manufacturing woes in the country have deepened.
Manufacturing output fell to 0.6% in October, the most since May 2018. Excluding autos, output was down 0.1% last month, the Federal Reserve data showed. Industrial production slipped 0.8%, while the Empire State Manufacturing Index tumbled to 2.9 from 5.0 expected.
Diminishing concerns over U.S. trade did nothing to ease forex traders. The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, fell 0.2% to 97.863 as of 11:08 AM ET (16:08 GMT).
White House economic advisor Larry Kudlow said on Thursday that the U.S. and China were close to securing a trade deal. His comments come after a week of volatility after reports that the two sides had hit a snag over trade talks. Chinese media on Friday fleshed out arguments that Chinese demand for U.S. farm products is nowhere near the level of purchases that Washington is insisting on in order to seal a partial phase one deal.
U.S. Commerce Secretary Wilbur Ross said Friday that U.S. and Chinese officials would hold a call later in the day, but added that the U.S. could still impose tariffs on Chinese goods, which are scheduled for Dec. 15.
The safe-haven Japanese yen was lower with USD/JPY up 0.3% to 108.75.
Elsewhere, the euro was higher, with EUR/USD up 0.3% to 1.1051 while GBP/USD rose 0.2% to 1.2901.
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LIke a scratched record the prospective trade deal is deciding the outcome on all markets.
Friday’s yes-we-are-closing-in-on-a-deal comments knocked gold lower and sent Wall Street to record highs.
Gold futures for December delivery on New York’s COMEX settled down $4.90, or 0.3%, at $1,468.50 per ounce.
Spot gold, which tracks live trades in bullion, slipped by $4.75, or 0.3%, to $1,466.20 per ounce by 2:23 PM ET (19:23 GMT).
Gold had proven a safe-haven hedge during the 16-month-long trade war, hitting six-year highs above $1,500.
On Thursday, both bullion and gold futures rose 0.7% after apparent disagreement over how much China will spend on U.S. farm products for a deal, and when and how tariffs imposed earlier this year and possibly boosted next month will be rescinded.
But in Friday’s trade, ebullience was back after White House economic advisor Larry Kudlow said that negotiators in Washington and Beijing were close to securing a deal.
All three major stock indexes on Wall Street also hit record highs after Commerce Secretary Wilbur Ross said U.S. and Chinese officials would hold a call later in the day, although the White House could still impose new tariffs on Chinese goods, scheduled a month from now.
Despite the broad appetite for risk, gold’s downside was still limited Friday by some investors’ thinking that the trade deal might be some way off. Chinese media, on Friday fleshed out arguments that Chinese demand for U.S. farm products is nowhere near the level of purchases that Washington is insisting on in order to seal a partial phase one deal.
Analysts at TD Securities said in a note:
“For investors, the impetus to buy gold as opposed to stocks is increasingly hard to justify with U.S. equities printing new all-time highs, making loss-aversion a tough sell. But as yields have also begun to creep lower – holding onto the downtrend formed by end of the hiking cycle – precious metals prices have remained resilient, despite being at a risky juncture with the Fed now on pause.”
Gold fell off the bullish $1,500 perch after Federal Reserve Chair Jay Powell suggested that the U.S. central bank’s third straight rate cut of a quarter point in October would be its last for the year.
TD Securities said while gold funds may have liquidated some of their long holdings in the yellow metal,
“the bar is high for machines to add further selling pressure, and aggregate open interest still sits at all time highs. Our estimated breakeven entry point for the bulls stands in the $1440/oz range, which suggests that a break below that range would be required for prices to be dragged lower by a decline in open interest. We contend that the pain trade is still to the downside in the near-term.”
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The we’ll-have-a-trade-deal-soon mantra provided a floor for oil again Friday, pushing crude prices to seven-week highs, even as Chinese media disputed Beijing’s willingness to commit to the kind of U.S. agricultural purchases.
Prices of U.S. West Texas Intermediate and London’s Brent rose by nearly 2% each, egged on by record highs for all the three major stock indexes on Wall Street, where the noise of a prospective trade deal was even greater.
NYME-traded WTI settled up 95 cents, or 1.7%, at $57.72 per barrel, after hitting a seven-week high of $57.97.
ICE (NYSE:ICE) Futures-traded U.K. Brent closed the regular U.S. trading up $1.02, or 1.6%, to $63.30. Earlier, it rose to a seven-week peak of $63.64.
Both crude benchmarks showed weekly gains of about 1%.
John Kilduff, partner at New York energy hedge fund Again Capital, said:
“It’s the mindless cacophony of the trade deal making its rounds again and everyone on Wall Street to NYMEX is latching on to it for a ride, regardless of the fact that it’s the same din we’ve been hearing for two weeks now — that a deal is coming. And there’s nothing on paper to prove the words.”
White House economic advisor Larry Kudlow said on Thursday that the U.S. and China were close to securing a trade deal. His comments come after a week of volatility after reports that the two sides had hit a snag over trade talks. Chinese media on Friday fleshed out arguments that Chinese demand for U.S. farm products is nowhere near the level of purchases that Washington is insisting on in order to seal a partial phase one deal.
U.S. Commerce Secretary Wilbur Ross said Friday that U.S. and Chinese officials would hold a call later in the day, but added that the U.S. could still impose tariffs on Chinese goods, which are scheduled for Dec. 15. Scott Brown, chief economist at Raymond James in St. Petersburg, Florida, said, expressing confidence that a deal might still happen:
“We have been here so many times where the market gets its hopes up and then it gets crushed.”
Reuters, meanwhile, assisted the bullish theme in oil somewhat by reporting that the U.S. shale industry plans another spending freeze next year.
The industry has seen a sharp slowdown in production growth, as prolific oil and natural gas output has pressured prices and squeezed profits, the report said.
Producers have already said they expect to spend about $4 billion less in 2019 than in 2018, according to U.S. financial services firm Cowen & Co., quoted by Reuters. So far, 21 exploration and production companies tracked by Cowen have released 2020 capex guidance with 15 projecting declines, five with increases and one unchanged, for a 13% year-over-year spending decline.
Yet, Investing.com oil columnist Ellen R. Wald wrote on Thursday that traders needed to beware that shale oil companies were sometimes overly dramatic in expressing their growth concerns:
“These could be tactics designed to reduce analysts’ expectations, so when these companies reveal their Q4 earnings, their share prices won’t drop nearly as much. With Chesapeake Energy’s share price so low that it is about to be delisted from the stock exchange, it wouldn’t be surprising to see similar oil producers actively trying to decrease expectations.”
Casting a further pall on the market, the International Energy Agency also said in its monthly report on Friday that OPEC and its allies face stiffening competition in 2020.
The IEA estimated non-OPEC supply growth would surge to 2.3 million barrels per day (bpd) next year compared to 1.8 million bpd in 2019, citing production from the United States, Brazil, Norway and Guyana.
See also:
- Oil Prices Gain Amid Reports of Potential OPEC Supply Curb
- Worrying Data For OPEC (Oilprice.com)
- U.S. Rig Count Crashes Again: Loses Nearly 100 Rigs In 3 Months (Oilprice.com)
Natural Gas (Oilprice.com)
Dry natural gas production in the United States will rise to an all-time high of 92.10 billion cubic feet per day (Bcf/d) in 2019, the EIA reported on Wednesday in its latest version of the Short Term Energy Outlook.
That figure is up 10% from 2018, but the EIA forecasts that the production growth in 2020 will be less due to “the lag between changes in price and changes in future drilling activity.”
The low prices for nat gas in Q3 2019 will trickle down and eventually reduce natural gas-directed drilling, the EIA says, by the first half of next year.
Natural gas production in 2020 is expected to reach 94.9 Bcf/d.
Total primary natural gas supply will also rise to 85.10 Bcf/d in 2019, before reaching 86.45 Bcf/d in 2020, the EIA said.
For net natural gas exports, the EIA is forecasting 4.8 Bcf/d in 2019, and then increasing to a staggering 7.4 Bcf/d in 2020. This is up from 2.0 Bcf/d in 2018, for a two-year increase of 270%.
The EIA estimates that the share of US total utility-scale electricity generation from natural gas-fired power plants will increase to 37% of the total in 2019 and 38% in 2020 – up from 34% in 2018. This increase will largely come at the expense of coal-fired power, which will fall from 28% of the total last year to 25% in 2019 and 22% in 2020.
This shift from coal to natural gas will also be responsible for lowering the projected carbon emissions in 2019 and 2020, to 5,180 million tonnes in 2019 and 5,074 million tonnes in 2020, the lowest level since 1991, Reuters reported.
The bridge fuel that the renewables industry is dismissing is, it would appear from the EIA data, far from “behind us“, with the EIA reporting no modest growth in renewable utility-scale generation in 2019 and 2020.
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