Daily global market update

On 22 November, 2017 - Global stocks were mixed

Stocks advanced in Asia but declined in Europe and were mixed in the US.

United States

US shares were little changed in subdued pre-Thanksgiving Day holiday trading. The Dow Jones industrials were down 0.3 percent and the S&P lost 0.1 percent. The Nasdaq however, edged up 0.1 percent.

Amazon.com and Apple advanced. Hewlett Packard Enterprise retreated after Meg Whitman said she would leave as chief executive in February. Verizon and AT&T were higher on bets they will benefit from the government's plan to rescind net neutrality rules. Qualcomm rose after Reuters reported Broadcom is considering raising its offer to buy its larger rival by offering more of its own stock. Deere & Co gained and touched a record high of $146.00 after reporting upbeat quarterly earnings and issuing a strong profit forecast for the year. Salesforce.com was lower after it reported quarterly revenue and profit that surpassed predictions, while forecasts for the fourth quarter fell short of expectations. Both Marathon Oil and Pioneer Natural Resources advanced.

The Federal Reserve published minutes of its November 1 FOMC meeting. At that time, they left the fed funds interest rate range unchanged at 1.00 percent to 1.25 percent. The minutes indicated that FOMC members remained concerned about the lack of inflation but indicated that interest rates would be raised in the near term. Board members agreed that the economy was poised for strong growth — but some said they needed more data before deciding on the timing of the next increase. The minutes said that there were lively discussions about why inflation has remained below the Fed's 2 percent inflation target for several years. Most agreed that tightness in the labor market would likely fuel higher inflation in the medium term.

The weekly initial jobless claims were down 13,000 to 239,000. October durable goods orders retreated 1.2 percent after jumping an upwardly revised 2.2 percent in September thanks to a sharp pullback in transportation equipment orders. Final November consumer sentiment reading was 98.5, up from the preliminary estimate of 97.8.

These data reflect observations at 4:00 PM US ET. Gold at the afternoon London fixing was up US$3.65 to US$1,286.95. Copper futures were up 0.25 percent to US$3.16. WTI spot crude was up US$1.17 to US$58.00. Dated Brent spot crude was up 70 US cents to US$63.27. The US dollar was down against all of its major counterparts including the yen, euro, pound, Swiss franc and the Canadian and Australian dollars. The Dollar Index was down 0.7 percent. The yield on the US Treasury 30 year bond was down 2 basis points to 2.74 percent while the 10 year note was down 4 basis points to 2.32 percent.

European markets

European markets were mostly lower Wednesday in choppy trading. Early strength in Europe was sparked by rising energy stocks as crude oil prices climbed. Mining stocks were also up, as metal prices climbed due to a pullback in the value of the US dollar. Traders were awaiting the FOMC minutes that will be released after markets here have closed for the day. The European Central Bank will also release the minutes from its most recent policy meeting Thursday. The FTSE edged up 0.1 percent. However, the CAC, SMI and DAX lost 0.2 percent, 0.4 percent and 1.2 percent respectively.

Chancellor of the Exchequer Philip Hammond presented the UK budget to Parliament. The government set aside an additional £3 billion over the next two years to aid the process of the country's exit from the European Union. It also slashed the growth forecasts for the next few years mainly due to a significant downward revision to potential productivity growth. The Chancellor further said the government is ready to commit more sums if and when needed.

Medicrea Group rallied after it announced that it has received FDA clearance for its IB3D range of 3D-printed Titanium. Sage Group advanced after the software manufacturer reported a substantial rise in annual profit. SSP Group was higher after the company raised its full-year dividend and proposed a special payout. Charles Stanley retreated after the wealth manager warned of regulatory changes weighing on the business. Thomas Cook declined after reporting a 40 percent drop in earnings at its UK division in the year to September 30. Roche climbed in Zurich on a broker upgrade. However, Givaudan dropped along with Logitech and Schindler. Tullow Oil gained as oil prices remained near a two-year high.

Asia Pacific

Asian Pacific stocks advanced Wednesday after major US indices hit fresh record closing highs overnight, buoyed by upbeat corporate earnings results and higher commodity prices. However, investors remained focused on the minutes from the latest Fed and ECB meetings later in the global market day Wednesday and Thursday respectively.

Both the Shanghai Composite and Hang Seng were up 0.6 percent. The Hang breached the 30,000 mark for the first time in a decade.

The Nikkei added 0.5 percent while the Topix was 0.3 percent higher. TDK, Toshiba, Japan Steel Works, Fuji Electric and Mitsubishi UFJ Financial all climbed. SoftBank Group and Fanuc gained along with Sumitomo Mitsui Financial Group and Dai-ichi Life Holdings.

Both the S&P/ASX and All Ordinaries finished the day 0.4 percent higher as rising oil and metals prices helped lift commodity-related stocks. Santos, Oil Search, Woodside Petroleum and Origin Energy advanced as oil hovered near a two-year high on expectations of a production cut next week at an OPEC meeting. Higher iron ore prices helped lift miners BHP Billiton and Rio Tinto gaining. Banks ended mostly lower.

The Kospi added 0.4 percent with tech stocks once again leading the surge. The Sensex was 0.2 percent higher on the day.

Looking forward

Thursday — Germany posts revised third quarter gross domestic product. November flash composite PMI will be released for France, Germany and the Eurozone. The UK reports its second estimate of third quarter gross domestic product. The European Central Bank publishes minutes from its recent monetary policy meeting. U.S. financial markets will be completely closed on Thursday in observance of the Thanksgiving Day holiday, with early closes in store for Friday. Japan’s markets will also be closed for a holiday.

Friday — Japan posts flash November manufacturing PMI. Germany reports November Ifo survey. The US posts flash composite PMI for November. Weekly money supply and fed balance sheet will be released. The NYSE closes at 2 PM US ET.

Global Stock Market Recap

Global Stock Market Recap

Bond markets

Bond markets

Currencies and commodities

Currencies and Commodities

The Longer-Term Perspective

The table below demonstrates that while we may experience some short-term weakness in markets, the longer-term performance remains encouraging.

equity market

*Note — all releases are listed in local time.

Anne D Picker
Chief Economist

Important Information

Econoday Inc. is a US company that provides financial commentary and indicators to industry professionals. All information provided and views expressed are those of Econoday. Reference in this document to specific securities should not be construed as a recommendation to buy or sell these securities, but is included for the purposes of illustration only. Past performance is not a reliable indicator of future results. The value of investments can go down as well as up and investors may not get back the amount invested.

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