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The best performers of the session on the Dow Jones Industrial Average were The Travelers Companies Inc (NYSE:TRV), which rose 4.00% or 3.44 points to trade at 89.51 at the close. Meanwhile, Chevron Corp (NYSE:CVX) added 3.48% or 2.00 points to end at 59.39 and Merck & Company Inc (NYSE:MRK) was up 0.89% or 0.63 points to 71.36 in late trade.
The worst performers of the session were Walt Disney Company (NYSE:DIS), which fell 9.43% or 8.95 points to trade at 85.98 at the close. 3M Company (NYSE:MMM) declined 9.18% or 12.62 points to end at 124.89 and Coca-Cola Company (NYSE:KO) was down 8.44% or 3.53 points to 38.30.
The top performers on the S&P 500 were Carnival Corporation (NYSE:CCL) which rose 20.00% to 12.00, MGM Resorts International (NYSE:MGM) which was up 18.31% to settle at 9.11 and Mosaic Co (NYSE:MOS) which gained 16.67% to close at 9.59.
The worst performers were FLIR Systems Inc (NASDAQ:FLIR) which was down 18.73% to 25.52 in late trade, WEC Energy Group Inc (NYSE:WEC) which lost 18.05% to settle at 74.09 and Arconic Inc (NYSE:ARNC) which was down 16.40% to 13.25 at the close.
The top performers on the NASDAQ Composite were Bellerophon Therapeutics Inc (NASDAQ:BLPH) which rose 430.97% to 18.0000, Frontier Communications Corp (NASDAQ:FTR) which was up 278.95% to settle at 0.9000 and Fiesta Restaurant Group Inc (NASDAQ:FRGI) which gained 214.90% to close at 10.99.
The worst performers were Sabre Corpo (NASDAQ:SABR) which was down 13.35% to 3.31 in late trade, Biomerica Inc (NASDAQ:BMRA) which lost 55.31% to settle at 7.150 and Waitr Holdings Inc (NASDAQ:WTRH) which was down 53.08% to 1.2200 at the close.
Falling stocks outnumbered advancing ones on the New York Stock Exchange by 1663 to 1251 and 35 ended unchanged; on the Nasdaq Stock Exchange, 1649 fell and 1056 advanced, while 35 ended unchanged.
Shares in FLIR Systems Inc (NASDAQ:FLIR) fell to 5-year lows; falling 18.73% or 5.88 to 25.52. Shares in WEC Energy Group Inc (NYSE:WEC) fell to 52-week lows; falling 18.05% or 16.32 to 74.09. Shares in Arconic Inc (NYSE:ARNC) fell to all time lows; losing 16.40% or 2.60 to 13.25. Shares in Walt Disney Company (NYSE:DIS) fell to 5-year lows; falling 9.43% or 8.95 to 85.98. Shares in 3M Company (NYSE:MMM) fell to 5-year lows; losing 9.18% or 12.62 to 124.89. Shares in Coca-Cola Company (NYSE:KO) fell to 3-years lows; falling 8.44% or 3.53 to 38.30. Shares in Bellerophon Therapeutics Inc (NASDAQ:BLPH) rose to 52-week highs; up 430.97% or 14.6100 to 18.0000. Shares in Sabre Corpo (NASDAQ:SABR) fell to all time lows; falling 13.35% or 0.51 to 3.31.
The CBOE Volatility Index, which measures the implied volatility of S&P 500 options, was down 8.28% to 66.04.
Gold Futures for April delivery was up 1.48% or 21.85 to $1501.15 a troy ounce. Elsewhere in commodities trading, Crude oil for delivery in May fell 8.68% or 2.25 to hit $23.66 a barrel, while the May Brent oil contract fell 3.83% or 1.09 to trade at $27.38 a barrel.
EUR/USD was up 0.05% to 1.0695, while USD/JPY rose 0.11% to 110.81.
The US Dollar Index Futures was down 0.40% at 103.188.
The U.S. dollar was sold in early trade in Europe Friday, with a more optimistic mood taking a hold of the markets as central banks continue to work on getting dollar liquidity to all corners of global markets. The expansion of swap lines between the Fed and its counterparts elsewhere has meant demand for the key safe haven play has been lessened.
At 04:10 ET (0810 GMT), EUR/USD traded at 1.0777, up 0.8%. The U.S. Dollar Index, which tracks the greenback against a basket of six other currencies, stood at 102.209, down 1.4%, while USD/JPY fell 0.9% to 109.73.
Late Thursday, the Federal Reserve said it would expand the currency swap lines to nine more countries, including central banks in Singapore, South Korea, Brazil, Sweden, Australia, New Zealand, Mexico, Norway and Denmark.
This comes amid reports of a “phase 3” package of fiscal support being prepared in the U.S. by Senate Republicans worth around $1.2 trillion.
One of the currencies which has gained the most against the dollar Friday has been the previously beleaguered pound, with GBP/USD up 2.8% to 1.1812.
The Bank of England on Thursday slashed rates and expanded its bond-buying program, saying it would increase its purchases of government and investment grade corporate bonds by 200 billion pounds ($230 billion) to 645 billion pounds.
Sterling has suffered of late, with GBP/USD falling Thursday to its lowest level since 1985, as many have seen the response by the U.K. authorities to the coronavirus outbreak as being late and insufficient. However, the central bank’s move is likely to provide funds for the chancellor to announce further measures to help cushion the blow.
The rate-setting meeting of Russia’s central bank later Friday will also be of interest.
The ruble has been hit hard this month, weighed on by a weak oil price and the rush to dollars as a safe haven as the coronavirus has hit the global economy. With this in mind, some market participants are expecting a hike from the current rate of 6.0% to support the currency.
However, ING said that holding rates steady, rather than hiking by 25 basis points, would be tightening enough. The bank points to the Russian central bank’s announcement Thursday of daily sales of foreign exchange on the open market, related to the sale of its 50% equity stake in Russia’s largest lender Sberbank to the National Wealth Fund.
Dmitry Dolgin, an analyst at ING, said in a research note:
“The central bank’s increased focus on the FX market suggests the lower importance of the policy rate and inflation targeting logic at this point. We take it as another confirmation of our view that CBR is not planning to increase the key rate tomorrow in the current market conditions.”
At 03:55 ET (0755 GMT), USD/RUB traded at 78.05, down 1.4%, having intervened on Thursday to keep the ruble below 80 to the dollar.
- Breaking: Bank of England Cuts Key Rate to 0.1%, Ramps up QE
- Forex – U.S. Dollar Falls; Yen Gains Despite Rising Stock Markets
- Forex – Dollar in Demand as Safe Haven
Gold prices drifted sideways in choppy trade on Friday as increasing signs of an economic shutdown in the U.S. and Europe battled for investors’ attention with reassuring news of more and more policy measures to support financial markets and the economy.
By 12:45 PM ET (1645 GMT), Gold Futures for delivery on the Comex exchange were up 0.5% at $1,487.45 a troy ounce, while spot gold was up 0.8% at $1,484.67. That’s a modest recovery after a week dominated by forced selling by diversified investors under pressure to raise liquidity.
Georgette Boele, an analyst with ABN AMRO (AS:ABNd), she expected more selling pressure on markets in general to keep a lid on gold prices through the second quarter. She cut her forecast for the end of Q2 to $1,300 from $1,450.
Boele pointed out that in the sell-off of 2013, investors liquidated 23 million ounces (from 82 million to 59 million) gold in ETFs, pushing prices down from $1,660 an ounce to $1,200. Boele wrote in a research note to clients:
“Total ETF positions in gold now stand at 86 million, so a similar move could not be ruled out, especially given that long gold is still a crowded trade.”
Elsewhere, government bond prices were also higher Friday, forcing yields down by up to 17 basis points at the long end of the yield curve, while Fed-sensitive two-year Treasury yields dropped a more modest 7 basis points to 0.35%.
The moves come as analysts radically revise down their forecasts for economic activity over the coming months, as more and more parts of Europe and North America head for near-total lockdown. New York state Governor Andrew Cuomo followed his Californian counterpart Gavin Newsom in ordering all workers in non-essential busineses to stay home to stop the spread of the virus.
There will be fines and mandatory closures for businesses that don’t comply with the new instructions, which come into force on Sunday evening, Cuomo said.
Over the weekend, Germany is also expected to announce tighter restrictions on non-essential business and social activity. The state of Bavaria, the country’s most economically important, already tightened its regime earlier Friday. Chancellor Angela Merkel is due to hold a conference call with state governors on Sunday.
At the same time, Germany is on the verge of breaking a decade-long taboo on state borrowing, with plans to launch a 500 billion emergency fund for businesses, according to Der Spiegel. German 10-year government bond yields rose 1 basis point to -0.33%, while eurozone sovereign spreads continued to narrow in the aftermath of the ECB’s 750 billion-euro quantitative easing move on Wednesday night.
Crude tumbled in volatile trading on Friday, with the world’s major producers struggling to adapt to the market’s biggest crisis in decades, as oil prices finished with another week of epic losses.
West Texas Intermediate, the New York-traded benchmark for U.S. crude prices, settled down $3.28, or nearly 13%, at $22.63 per barrel.
Just a day ago, WTI jumped 24%, reversing all of what it lost Wednesday. For the week, the U.S. crude benchmark was down 29%, following through with the previous week’s 23% slide.
Brent, the London-traded global benchmark for crude, settled Friday’s trade down $1.49, or 5.2%, at $26.98. For the week, Brent fell 20%, after the previous week’s 25% drop.
The epic losses in oil come amid a perfect storm of demand destruction caused by the Covid-19 pandemic and a production hikes-and-markets-share tussle between Saudi Arabia and Russia.
In Friday’s session, WTI initially fell more than 7% on a Bloomberg report that Russia “will not blink” in its face-off with Riyadh.
But by early afternoon in New York, WTI pared losses after industry firm Baker Hughes reported that rigs actively drilling for oil in the United States had fallen by 19 this week to 664. While a lagging indicator, the weekly rig count is one of the most trusted predictors of U.S. crude production.
Crude prices also came off their lows after Texas oil regulator Ryan Sitton said he had discussed the global oil and supply situation with OPEC Secretary-General Mohammed Barkindo and been invited to the cartel’s upcoming meeting in June.
Sitton is a member of the Texas Railroad Commission, which regulates the energy industry in the largest U.S. oil producing, The Wall Street Journal reported on Thursday that shale oil producers in Texas had approached the TRC for relief amid the crisis in oil prices on the back of the pandemic and the Saudi-Russian face-off. The TRC last imposed production curbs in Texas in the 1970s and Sitton has been reported to be leading the initiative to reintroduce them.
But TRC Chairman Wayne Christian poured cold water on Sitton’s plan later on Friday, saying he has some “reservations” about doing any production cuts in Texas. That promptly sent crude prices tumbling again. Christian said in a statement:
“While I am open to any and all ideas to protect the Texas Miracle, as a free-market conservative I have a number of reservations about this approach.
“First, Texas does not operate in a vacuum. If we prorate our oil, there is no guarantee other nations, or even states will follow suit. From a practical standpoint, the Railroad Commission has not prorated oil in over forty years; we do not have staff at the agency with experience in this process and our IT capabilities to handle this process are limited at best.”
Market participants, meanwhile, hunkered down for more volatility in the week ahead. Craig Erlam, senior market analyst at online trading platform OANDA, said:
“I don’t expect a strong rebound in the near-term, with neither Russia or Saudi Arabia looking likely to blink, but we could now start to stabilize around these incredibly low levels.”
- Breaking-Texas Oil Regulator Had “Great” Talks With OPEC; Invited To June Meet
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Natural Gas (Hellenic Shipping News)
This winter, natural gas prices have been at their lowest levels in decades. On Monday, February 10, the near-month natural gas futures price at the New York Mercantile Exchange (NYMEX) closed at $1.77 per million British thermal units (MMBtu). This price was the lowest February closing price for the near-month contract since at least 2001, in real terms, and the lowest near-month futures price in any month since March 8, 2016, according to Bloomberg, L.P. and FRED data.
In addition, according to Natural Gas Intelligence data, the daily spot price at the Henry Hub national benchmark was $1.81/MMBtu on February 10, 2020, the lowest price in real terms since March 9, 2016. Henry Hub spot prices have ranged between $1.81/MMBtu and $2.84/MMBtu this winter heating season (since November 1, 2019), generally because relatively warm winter weather has reduced demand for natural gas for heating. Natural gas production growth has outpaced demand growth, reducing the need to withdraw natural gas from underground storage.
Dry natural gas production in January 2020 averaged about 95.0 billion cubic feet per day (Bcf/d), according to IHS Markit data. IHS Markit also estimates that in January 2020 the United States saw the third-highest monthly U.S. natural gas production on record, down slightly from the previous two months.
IHS Markit estimates that U.S. natural gas consumption by residential, commercial, industrial, and electric power sectors averaged 96 Bcf/d for January, which was about 4.4 Bcf/d less than the average for January 2019, largely because of decreases in residential and commercial consumption as a result of warmer temperatures.
However, IHS Markit estimates that overall consumption of natural gas (including feed gas to liquefied natural gas (LNG) export facilities, pipeline fuel losses, and net exports by pipeline to Mexico) averaged about 117.5 Bcf/d in January 2020, an increase of about 0.2 Bcf/d from last year. This overall increase is largely a result of an almost doubling of LNG feed gas to about 8.5 Bcf/d.
Because supply growth has outpaced demand growth, less natural gas has been withdrawn from storage withdrawals this winter. Despite starting the 2019 – 20 heating season with the third-lowest level of natural gas inventory since 2009, by January 17, 2020, working natural gas inventories reached relatively high levels for mid-winter. The U.S. Energy Information Administration’s (EIA) data on natural gas inventories for the Lower 48 states as of February 7, 2020, reflect a 215 Bcf surplus to the five-year average. In EIA’s latest short-term forecast, more natural gas remains in storage levels than the previous five-year average through the remainder of the winter.
Source: U.S. Energy Information Administration, Weekly Natural Gas Storage Report and Short-Term Energy Outlook
According to the National Oceanic and Atmospheric Administration (NOAA), January 2020 was the fifth-warmest in its 126-year climate record. Heating degree days (HDDs), a temperature-based metric for heating demand, have been relatively low this winter, which is consistent with a warmer winter. During some weeks in late December and early January, the United States saw 25% to 30% fewer HDDs than the 30-year average. This winter, through February 8, residential natural gas customers in the United States have seen 11% fewer HDDs than the 30-year average.
Source: U.S. Energy Information Administration, based on National Oceanic and Atmospheric Administration Climate Prediction Center data
Dow Dives 913 Points Amid Worst Week Since 2008