Written by Investing.com Staff, Investing.com
U.S. stocks higher at close of trade; Dow Jones Industrial Average up 1.11%
U.S. stocks were higher after the close on Friday, as gains in the Technology, Basic Materials and Healthcare sectors led shares higher.
At the close in NYSE, the Dow Jones Industrial Average added 1.11%, while the S&P 500 index added 1.39%, and the NASDAQ Composite index climbed 1.65%.
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The best performers of the session on the Dow Jones Industrial Average were Home Depot Inc (NYSE:HD), which rose 4.87% or 9.86 points to trade at 212.18 at the close. Meanwhile, Apple Inc (NASDAQ:AAPL) added 2.89% or 7.94 points to end at 282.97 and International Business Machines (NYSE:IBM) was up 2.78% or 3.37 points to 124.72 in late trade.
The worst performers of the session were Boeing Co (NYSE:BA), which fell 6.36% or 8.76 points to trade at 128.98 at the close. Procter & Gamble Company (NYSE:PG) declined 0.52% or 0.62 points to end at 118.78 and Johnson & Johnson (NYSE:JNJ) was down 0.42% or 0.65 points to 154.86.
The top performers on the S&P 500 were Freeport-McMoran Copper & Gold Inc (NYSE:FCX) which rose 8.58% to 8.48, Invesco Plc (NYSE:IVZ) which was up 7.73% to settle at 7.80 and SVB Financial Group (NASDAQ:SIVB) which gained 7.60% to close at 184.00.
The worst performers were Arconic Inc (NYSE:ARNC) which was down 8.84% to 8.04 in late trade, Helmerich and Payne Inc (NYSE:HP) which lost 8.12% to settle at 17.77 and Boeing Co (NYSE:BA) which was down 6.36% to 128.98 at the close.
The top performers on the NASDAQ Composite were Mesoblast Ltd (NASDAQ:MESO) which rose 139.53% to 15.45, Microbot Medical Inc (NASDAQ:MBOT) which was up 47.91% to settle at 9.20 and Liberty Tripadvisor Holdings Inc (NASDAQ:LTRPB) which gained 38.58% to close at 37.57.
The worst performers were Golden Bull Ltd (NASDAQ:DNJR) which was down 32.89% to 1.5300 in late trade, Akazoo SA (NASDAQ:SONG) which lost 22.32% to settle at 1.16 and Interpace Diagnostics Group Inc (NASDAQ:IDXG) which was down 15.11% to 5.0000 at the close.
Rising stocks outnumbered declining ones on the New York Stock Exchange by 1758 to 1112 and 68 ended unchanged; on the Nasdaq Stock Exchange, 1767 rose and 874 declined, while 77 ended unchanged.
Shares in Mesoblast Ltd (NASDAQ:MESO) rose to 3-years highs; rising 139.53% or 9.00 to 15.45. Shares in Akazoo SA (NASDAQ:SONG) fell to all time lows; down 22.32% or 0.33 to 1.16.
The CBOE Volatility Index, which measures the implied volatility of S&P 500 options, was down 13.17% to 35.93 a new 1-month low.
Gold Futures for June delivery was up 0.01% or 0.25 to $1745.65 a troy ounce. Elsewhere in commodities trading, Crude oil for delivery in June rose 4.18% or 0.69 to hit $17.19 a barrel, while the June Brent oil contract rose 2.72% or 0.58 to trade at $21.91 a barrel.
EUR/USD was up 0.42% to 1.0821, while USD/JPY fell 0.04% to 107.53.
The US Dollar Index Futures was down 0.27% at 100.265.
See also:
Stocks – Dow Snaps Two-Week Rally Despite Strong End to Week on Tech
Stocks – Dow Turns Higher, Led by Tech, as Traders Weigh Stimulus, Weaker Data
Stocks – Wall Street Pares Early Gains as Consumer Sentiment Data Weigh
The dollar traded in a narrow range Friday, as weaker economic data failed to trigger a meaningful move in either direction. But the greenback remained set to post a second-straight win thanks to strong gains against both the euro and sterling this week.
The U.S. dollar index, which measures the greenback against a trade-weighted basket of six major currencies, was flat at 100.41, and traded in range of 100.25 to 100.87 in the session.
U.S. durable goods orders fell by 14.4% last month, the biggest slide since 2014, led by waning demand for big-ticket items such as cars and slump in orders for Boeing (NYSE:BA) passenger planes.
The dearth of movement in the greenback comes during a week in which the world’s reserve currency racked up gains against both the pound and the euro.
GBP/USD was flat at $1.2353, but is on pace to snap a two-week winning streak. Concerns about Brexit weighed as the U.K and EU trade talks that got underway this week failed to show any sign of progress.
The U.K. “failed to engage substantially” on key sticking points in Brexit talks held this week, the EU’s chief negotiator Michel Barnier said.
Despite the current disruptions caused by the Covid-19 crisis, the U.K. continues to insist that it will not extend the transition period beyond the end of the year. UniCredit said:
“The improvement so far has been larger for the euro than for sterling, which experienced a more abrupt and more intense drop against the USD and is still suffering from Brexit uncertainty.”
EUR/USD fell 0.16% to $1.794.
See also:
- Forex – Dollar Pushes Higher as Drug Trial Disappoints
- Dollar Rises as “Horrible” Economic Data Lead Investors to Seek Safe Haven
- Euro Slips as EU Leaders Fail to Agree Stimulus Plan
- Sterling Cuts Gains as Analysts Flag Further Coronavirus Economic Woes Ahead
Gold’s delicate dance in the $1,700 zone continued Friday with the yellow metal’s slight retreat after rival dollar hit a near-three-week high.
But the safe-haven crowd has a bigger worry for the coming week: India’s continued lockdown amid the Covid-19 pandemic and how that would affect demand from bullion’s biggest supporter.
Nicholas DeGeorge, senior market strategist for precious metals at RJO Futures in Chicago, said:
“Gold is going to have to face a little adversity over the next couple of trading days with the U.S. dollar making fresh new weekly highs overnight and with the world’s largest import country of gold on nationwide lockdown.”
Gold is a sacred metal in India, whose ornamental value is second to none. Statues of HIndu deities in Indian temples are typically adorned with the yellow metal, which is also a staple expense at weddings. India’s central bank holds most of its reserves in gold and Indians generally wear gold jewelry in daily life and at social occasions, resulting in an annual import of 800 to 900 metric tons.
India’s second largest buying day of the year for gold comes up this Sunday and its lockdown “will surely impact physical demand” for the metal, DeGeorge said.
Gold futures for June delivery on New York’s COMEX settled down $9.80, or 0.6%, at $1,735.60 per ounce. For the week, though, it was up 2.3% after Wednesday’s strong move into $1,700 territory.
Spot gold, which tracks live trades in bullion, was down $6.07, or 0.4%, at $1,725.07 by 3:05 PM ET (19:05 GMT).
The dollar index, which pits the dollar against a basket of six currencies, was flat at 100.44 after hitting an 18-day high of 100.98 earlier.
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The trust deficit in the front-month contract of U.S. crude is growing, even as the market struggles to maintain its rebound.
Oil prices remained higher for a fourth-straight day on Friday, while remaining down on the week after Monday’s historic negative pricing.
But open interest in the front-month June contract of West Texas Intermediate was already trailing that of July WTI, signaling investors’ preference for the “safer” contract that pledges to deliver oil later rather than sooner in a glutted market. It also signals that the spot contract could be in for another financial squeeze and another round of subzero prices when it comes up for expiry on May 19.
June WTI was up 44 cents, or nearly 3%, at $16.94 per barrel. For the week, it was down 7%
Brent, the London-traded global benchmark for crude, rose 46 cents, or 2%, to $20.21 by 3:20 PM ET (19:20 GMT). It was down 22% on the week.
Since plumbing $37 below zero on Monday, WTI has managed to stay on an upward trajectory amid optimism that U.S. production was falling – oil rigs in the country declined by 60 this week – and OPEC cuts of nearly 10 million barrels per day would kick in by May to partially offset the demand loss of some 30 million bpd from the Covid-19 pandemic.
Yet worries about another squeeze in WTI’s front month at next month’s expiry kept some at bay. Olivier Jakob, founder of Zug, Switzerland-based oil-risk consultancy PetroMatrix, referring to June WTI, which was at a discount of $5 per barrel and 25,000 lots less in open interest to July WTI, said:
“More brokers, and not just the discount brokers, are limiting access to the first contract of oil futures. If open interest continues to move early out of the first month, it could be increasingly difficult for the roll of indices still having holdings of front-month futures, but as well for the delta-hedging of options. Margin requirements are also increasing to take into account the volatility seen this week.”
Igor Windisch of the IBW Oil Brief said brokerages that had told clients not to buy front-month oil included AMP Global Clearing, TradeStation Securities, INTL FCStone and Marex:
“All have imposed restrictions on their customers from taking new positions in June WTI and Brent. Margin requirements have been raised.”
Bob Yawger, director of the futures division for Mizuho, weighed in as well, saying that:
“(w)hen you think about some of these firms, their customers were probably not trading for size. But when you take on an aggregate amount of these folks, it adds up and you definitely lose some liquidity in the front.”
See also:
- Crude Oil Edges Higher, But Market Remains Oversupplied
- Oil Up With Hopes of Production Cuts, But Oversupply Dilemma Remains
- U.S. Crude Oil Gains 65% in 2 Days, Going From Cold to Hot
Natural Gas (ETF Daily News)
In November 2019, the price of natural gas reached a seasonal high of $2.905 per MMBtu, substantially below the peak from November 2018 when the energy commodity climbed to $4.929 per MMBtu. Since last November, the price has done nothing but make lower highs and lower lows. Each new low led to a bounce in the natural gas futures arena that ran out of upside steam before reaching the previous short-term peak.
The most recent low came at the end of March when the price of nearby natural gas futures reached $1.519 per MMBtu, the lowest price since 1995. After a recovery to just over the $1.90 level, the price failed and was trading at just below the $1.60 level on Thursday, April 16. The price was once again probing into the $1.50s.
Meanwhile, with the price of crude oil back below $20 per barrel on the back a demand disaster, natural gas could face the same fate. The price was a stone’s throw away from the late March low after the Energy Information Administration reported its second injection of the season on Thursday. The United States Natural Gas Fund (UNG) replicates the price action in the nearby NYMEX natural gas futures market.
The market expected an injection of 45 bcf
The average consensus estimate for the build in storage for the week ending on April 10 was for an injection of 45 billion cubic feet according to Estimize.
(Source: EIA)
The chart shows that the injection of 73 billion cubic feet came in over the projection levels. Total stocks stand at 2.097 trillion cubic feet, 71.7% above last year’s level, and 21.4% over the five-year average for this time of the year.
(Source: CQG)
The ten-minute chart shows that the price fell to the low at the time of the EIA’s latest release and rallied a bit from $1.555 per MMBtu in the aftermath of the report despite the higher than expected injection on April 16.
Natural gas sits below the $1.60 per MMBtu level
The bearish trend and pattern of lower highs in the natural gas market remained intact as of April 16.
(Source: CQG)
As the daily chart of May futures illustrates, price momentum and relative strength indicators were pointing lower and were below neutral readings on April 16. Daily historical volatility at 82.9% was near the highest level of 2020 on the nearby contract.
Meanwhile, the total number of open long and short positions edged higher from 1.186 million contracts on April 8, the day that natural gas hit its most recent high of $1.918 per MMBtu to 1.24 million on April 15, an increase of 54,000 contracts or 4.55%.
The potential for a lower low rise
On the May contract, the technical support level stands at the April 2 low of $1.521 per MMBtu. After the recovery that failed at just over $1.90, the rise in open interest is a technical validation of the continuation of a bearish trend in the energy commodity. Throughout late 2019 and 2020, each attempt at a recovery attracted selling. The continuous contract low of $1.519 is now the gateway to another new twenty-five-year low in the natural gas market. While the technical trend remains bearish, fundamentals also support another move to the downside. The price action in the crude oil market at below $20 per barrel is another sign of weakness in demand for energy commodities during the shutdown to slow the spread of Coronavirus.
(Source: CQG)
As the quarterly chart shows, the long-term levels of technical support stand at the 1995 lows of $1.335 and $1.25 per MMBtu.
When technical and fundamental factors point lower for a market, new lows often are on the horizon. Natural gas is at its lowest level in years, but that does not mean the price cannot work its way even lower.
See also:
U.S. Natural Gas to Be World’s Priciest Amid Virus Upheaval (Bloomberg)
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