Written by Investing.com Staff, Investing.com
U.S. stocks higher at close of trade; Dow Jones Industrial Average up 0.29%
U.S. stocks were higher after the close on Friday, as gains in the Basic Materials, Consumer Goods and Oil & Gas sectors led shares higher.
At the close in NYSE, the Dow Jones Industrial Average gained 0.29%, while the S&P 500 index added 0.38%, and the NASDAQ Composite index added 0.48%.
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The best performers of the session on the Dow Jones Industrial Average were Nike Inc (NYSE:NKE), which rose 3.13% or 4.40 points to trade at 145.03 at the close. Meanwhile, Cisco Systems Inc (NASDAQ:CSCO) added 1.82% or 0.86 points to end at 48.11 and Dow Inc (NYSE:DOW) was up 1.81% or 1.02 points to 57.36 in late trade.
The worst performers of the session were Boeing Co (NYSE:BA), which fell 1.50% or 3.17 points to trade at 207.47 at the close. UnitedHealth Group Incorporated (NYSE:UNH) declined 1.54% or 5.07 points to end at 324.25 and Intel Corporation (NASDAQ:INTC) was down 0.80% or 0.47 points to 58.32.
The top performers on the S&P 500 were Coty Inc (NYSE:COTY) which rose 10.30% to 7.60, Activision Blizzard Inc (NASDAQ:ATVI) which was up 10.02% to settle at 101.97 and Wynn Resorts Limited (NASDAQ:WYNN) which gained 7.74% to close at 117.10.
The worst performers were TechnipFMC PLC (NYSE:FTI) which was down 5.94% to 10.77 in late trade, Cabot Oil & Gas Corporation (NYSE:COG) which lost 5.56% to settle at 17.82 and Unum Group (NYSE:UNM) which was down 4.86% to 23.49 at the close.
The top performers on the NASDAQ Composite were Atlantic American Corporation (NASDAQ:AAME) which rose 168.20% to 6.410, BSQUARE Corporation (NASDAQ:BSQR) which was up 86.97% to settle at 3.552 and Ocugen, Inc (NASDAQ:OCGN) which gained 57.23% to close at 5.1100.
The worst performers were ATA Inc (NASDAQ:AACG) which was down 57.27% to 6.110 in late trade, Cassava Sciences Inc (NASDAQ:SAVA) which lost 23.87% to settle at 48.29 and Davidstea Inc (NASDAQ:DTEA) which was down 24.02% to 5.220 at the close.
Rising stocks outnumbered declining ones on the New York Stock Exchange by 2088 to 1013 and 81 ended unchanged; on the Nasdaq Stock Exchange, 1887 rose and 1194 declined, while 67 ended unchanged.
Shares in Activision Blizzard Inc (NASDAQ:ATVI) rose to all time highs; gaining 10.02% or 9.29 to 101.97. Shares in Atlantic American Corporation (NASDAQ:AAME) rose to 5-year highs; rising 168.20% or 4.020 to 6.410. Shares in BSQUARE Corporation (NASDAQ:BSQR) rose to 52-week highs; gaining 86.97% or 1.652 to 3.552. Shares in Ocugen, Inc (NASDAQ:OCGN) rose to 52-week highs; gaining 57.23% or 1.8600 to 5.1100.
The CBOE Volatility Index, which measures the implied volatility of S&P 500 options, was down 3.63% to 20.98 a new 1-month low.
Gold Futures for April delivery was up 1.16% or 20.75 to $1811.95 a troy ounce. Elsewhere in commodities trading, Crude oil for delivery in March rose 1.39% or 0.78 to hit $57.01 a barrel, while the April Brent oil contract rose 0.83% or 0.49 to trade at $59.49 a barrel.
EUR/USD was up 0.69% to 1.2045, while USD/JPY fell 0.12% to 105.41.
The US Dollar Index Futures was down 0.59% at 91.013.
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The dollar edged lower in early European trading Friday, consolidating after strong gains this week driven by growing confidence in the U.S. economic recovery.
At 3:55 AM ET (0755 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, was down 0.1% at 91.523, but heading for its best week in three months after touching 91.60 for the first time since early December.
USD/JPY fell 0.1% at 105.51, EUR/USD was flat at 1.1961, after earlier dipping to 1.1952, a level not seen since Dec. 1, while the risk-sensitive AUD/USD rose 0.1% at 0.7601.
The dollar has gained many friends of late, and the index is on track for a 1.1% weekly rise, the most since Nov. 1, after a 0.3% gain the previous week.
This sentiment has improved on the prospect of a hefty stimulus from President Joe Biden’s administration, rising Treasury yields and the continued roll-out of vaccines, turning the greenback from a safe haven to a risk-on currency.
Also helping has been signs of an improving U.S.economy. Thursday’s data revealed that 779,000 initial jobless claims were filed over the past week, an improvement from the 812,000 claims reported during the previous week.
There’s more U.S. jobs data due later Friday, in the form of the non-farm payrolls report for January, and this is expected to show a gain of 50,000 jobs after December’s fall of 140,000.
By contrast, German factory orders fell for the first time in eight months after the spread of the coronavirus forced the euro area’s biggest economy and many of its trading partners into lockdowns. ING analysts said in a research note:
“Short term risks remain to the EUR/USD downside, given the positioning and slow pace of EZ vaccination.”
Elsewhere, GBP/USD rose 0.1% to 1.3683, after the Bank of England signaled that negative interest rates are less likely. The two-year U.K. gilt yield rose to -0.02% and appears set to turn positive for the first time since May. .
However, the central bank also pointed to a rapid rebound in growth in the second half of 2021 as the country’s vaccination program gathers steam. Government projections suggest all adults in the U.K. could be vaccinated by June. By contrast, Germany doesn’t expect to reach that milestone until September. ING added:
“The latest decision from the Bank of England keeps the door open to negative rates, though only after a six-month period of industry preparation. But optimistic growth forecasts suggest that a foray into sub-zero rates is increasingly unlikely in the current cycle.”
See also:
- Dollar in Demand on U.S. Economic Progress (Thursday)
Gold returned to above $1,800 an ounce on Friday after tumbling beneath the key support level a day ago, but the yellow metal still finished the week down some 2% due setbacks dealt by the dollar and surging U.S. bond yields. Ed Moya, senior market strategist at online broker OANDA, said:
“Gold is trying to hold the $1,800 line and that could be the case if the dollar rebound is over. But technical selling that is building for gold is significant and could trigger a drop towards the $1,750 level.”
Benchmark gold futures for April delivery on New York’s Comex settled up $21.80, or 1.2%, at $1,813.05. It had tumbled to as low as $1,784.60 on Thursday after a third straight weekly drop in U.S. jobless claims created the impression that the labor market in the world’s largest economy may be putting in a modest recovery. That theory sparked a rally in the dollar and the benchmark 10-year U.S. Treasury note
Friday’s rebound in the yellow metal also came on the back of U.S. employment data, this time for all of last month. Despite the climb, April gold still finished the week about $37, or 2%, lower.
For January, the United States added 49,000 jobs – just 1,000 less than forecast by economists. But the unemployment remained at a troubling 6.3% despite a drop of 0.4 percentage points. That reversed some of Thursday’s pop in the dollar, bringing some buyers back to gold. Eren Sengezer said, using the symbol for spot gold, in a post on FXStreet:
“XAU/USD looks vulnerable despite reclaiming $1,800 on Friday.”
Gold prices have foundered since hitting record highs of nearly $2,090 an ounce in early August and suffered a deeper setback from November onwards as vaccine breakthroughs for the Covid-19 suggested rapid economic recovery from earlier lockdowns.
That economic rebound has barely materialized due to a new spike in infections and deaths from the virus and slower-than-anticipated vaccine rollouts. But that hasn’t stopped currency and debt traders from continuing to anticipate faster-than-anticipated GDP growth and tapering of stimulus despite the Federal Reserve repeatedly saying neither will likely be as quick as thought.
Gold has also been suppressed on signs that President Joe Biden and Democrats backing him might have trouble passing a $1.9 trillion stimulus in Congress against the objections of rival Republicans.
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Crude prices rose some 9% on the week but fell short of the $60 per barrel mark targeted by oil bulls, suggesting the market may be overbought in the short-term and could consolidate even if it hits that high point.
New York-traded West Texas Intermediate, the key indicator for U.S. crude, settled up 62 cents, or 2.2%, at $56.85 per barrel. For the week, WTI gained some 9%.
London-traded Brent, the global benchmark for crude, settled up 50 cents, or 0.8%, at $59.34. For the week, Brent gained about 6%.
U.S. gasoline RBOB futures meanwhile traded as high as $1.6729 a gallon, their highest since mid-February last year, when world oil demand began to collapse under the weight of the Covid-19 pandemic.
The market has been cheered this week by the way OPEC’s monthly meeting on output policy played out, with no extra output agreed and plenty of evidence of output quotas being observed. Nigerian output in particular has now fallen to a level that almost compensates entirely for its overproduction last summer, partly due to disruptions at some of its export facilities. In addition, another week of clear drawdowns in U.S. and international inventories has convinced many that the market is set to tighten meaningfully as demand picks up in the course of the year, pushing back-month futures contracts sharply higher.
Saxo Bank head of commodity strategy Ole Hansen said in a morning note:
“The market is increasingly pricing in a belief that last year’s price crash together with an increased investor focus on environmental, social and corporate governance (ESG) could led to a future shortfall due to lack of investments towards exploration. However, before we reach that stage, global demand needs to recover from the current 94 million barrels/day and back towards 100 million seen a year ago, while OPEC+ slowly returns 7 million barrels/day of still capped production.”
Others, too, warned that the market may have come too far, too fast. Rystad Energy’s head of oil markets research, Bjornar Tonhaugen, said in emailed comments:
“Continuous storage draws is what bullish traders love to see, after a year of monstrous inventory builds, so once the trend is constant the market sees little reason to stop the price hype. Many technical indicators are flashing red, so a price correction soon would not be unsurprising,”
One possible source of a bearish shock is Iran, which is not covered by the OPEC agreement on output restraint. Axios reported earlier Friday that President Joe Biden is in a hurry to return to the UN-sponsored agreement under which Iran stopped enriching uranium in 2015.
Biden suspended aid to Saudi Arabia this week as regards the prosecution of its campaign in Iranian-backed Houthi rebels in Yemen.
However, the U.S. move to seize an Iranian oil tanker this week on suspicion of sanctions-busting suggests that the new administration won’t be too quick to ease the pressure on its oil exports.
See also:
Natural Gas (Hellenic Shipping News)
US working natural gas stocks dipped less than the market expected last week, leading to a dip in the Henry Hub prompt month, but a cold spell seizing most of the nation could lead to the largest draw of the heating season thus far for the week in progress.
Storage inventories decreased by 128 Bcf to 2.881 Tcf for the week-ended Jan. 22 the US Energy Information Administration reported Jan. 28. It was a sharp departure from the massive 187 Bcf draw reported the week prior.
US supply and demand balances were much looser than the week prior. The call on storage fields fell by 6.4 Bcf/d week over week, according to S&P Global Platts Analytics. Total demand saw a large decline due to milder temperatures, which pushed residential and commercial and industrial combined demand down nearly 2.9 Bcf/d.
In addition, gas-fired power generation fell by 3.3 Bcf/d. This was due in part to higher wind and coal generation. Gas supply remained relatively stable as 300 MMcf/d of growth in US production was offset by an almost equal decline in net Canadian imports. Colder weather in Canada led to a spike in local demand resulting in less export to the Lower 48.
The withdrawal was weaker than an S&P Global Platts’ survey of analysts calling for a 136 Bcf draw. The pull also trailed the 170 Bcf draw reported during the same week last year as well as the five-year average withdrawal of 174 Bcf, according to EIA data.
Storage volumes now stand 78 Bcf, or 3%, more than the year-ago level of 2.803 Tcf and 244 Bcf, or 9%, more than the five-year average of 2.637 Tcf.
The NYMEX Henry Hub March contract slipped 2 cents to $2.68/MMBtu on Jan. 28. Despite the slight dip, the prompt-month contract stands 14 cents higher than one week prior as frigid temperatures have gripped much of the nation during the week in progress, leading to the highest demand of the heating season thus far in multiple storage regions.
Platts Analytics’ forecasts a 198 Bcf withdrawal for the week ending Jan. 29 as a cold-weather pattern moves east across the US, dragging down temperatures in the Northeast and Southeast, likely driving demand to a year-to-date high. Average temperatures plummeted Jan. 28 in the Northeast and Southeast cell by 7.5 degrees Fahrenheit and 11.5 degrees, respectively.
It also remains cold across the Midwest, prompting production freeze-offs, particularly in the Bakken Shale. Across the Eastern US, demand has risen by a combined 8 Bcf on the day.
Source: Platts
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