Monday: 27th November 2017
Each Market In Focus
- Major banks again held Australian shares back, leaving the benchmark S&P/ASX 200 down slightly for the week despite an afternoon recovery.
- It was second-straight slight drop amid sliding stocks in China, Australia’s largest export market. The ASX fell 3.6 points to 5982.6, but it still rose 0.4% for the week.
- The Big Four banks collectively lost more than 6 points, partly offset by gains in the materials sector — which helped buoy the market this week after strong rebounds for base metals and iron ore.
- With iron ore heading towards a bull market, resource stocks were among the best performers: Mid-cap miner Mineral Resources surged 7.8% after it surprised brokers, including Macquarie, with its bllish outlook for shipments of lithium direct shipping ore, or DSO, from its Wodgina operation in Western Australia.
U.S. stocks capped off a quiet stretch of holiday trading with a weekly gain.
Activity in the stock market has been muted in recent sessions, with U.S. trading closed Thursday in observance of Thanksgiving and the market shutting early Friday.
Still, major indexes have generally continued to extend their 2017 rally, with advances in shares of industrial, technology and consumer-discretionary companies lifting the S&P 500, Dow Jones Industrial Average and Nasdaq Composite to fresh records this week.
The S&P 500 rose 5.34 points, or 0.2%, to 2602.42, closing above the 2600 level for the first time.
The day’s moves brought the broad index to its 55th closing record of the year and its second-fastest 100-point milestone on record.
- Gold futures finished modestly lower as investors booked some of the yellow metal’s strong pre-Thanksgiving gain.
- The commodity unhinged from its typically relationship with the U.S. dollar, which extended its slump in the wake of Federal Reserve signals for a cautious approach to interest-rate tightening next year.
- IRON ORE: $67.12 +2.32( December contract )
- Oil prices rose for the third session in a row, as falling stockpiles and expectations for extended supply cuts boosted optimism in the market.
- Light, sweet crude for January delivery advanced 93 cents, or 1.6%, to $58.95 a barrel on the New York Mercantile Exchange, trading at the highest level since June 2015.
- Brent, the global benchmark, gained 31 cents, or 0.5%, to $63.86 a barrel.
- Prices have rallied this week on data from the U.S. Energy Information Administration that showed crude stockpiles fell by 1.9 million barrels last week, a sign that the rebalancing in the oil market is having an impact on U.S. storage.
- Investors are also betting on an extension of a deal between the Organization of the Petroleum Exporting Countries and other major global producers, who agreed to curb output last year in an attempt to bring global stockpiles back down to the five-year average.
- To hit that target, analysts say OPEC will have to continue the agreement past March 2018, at which the current deal would expire.
- The group of oil producing nations is set to convene Nov. 30 in Vienna.
- The U.S. dollar fell versus the euro as recent data from Europe is painting a picture of solid growth, while concerns are growing in the U.S. about the pace of inflation.
- The Wall Street Journal Dollar Index, which measure the currency against a basket of 16 others, fell 0.2% to a recent 86.38.
- The U.S dollar slipped 0.7% against the euro.
- The Ifo Institute said its Business Climate Index rose to 117.5, suggesting the European economy is on track to grow 2.3% this year.
- That follows a release Thursday from data firm IHS Markit that its composite Purchasing Managers Index for the eurozone rose to its highest level in more than 6 1/2 years.
- The strength of the European economy is helping to overcome concerns among investors about the difficulties faced by German Chancellor Angela Merkel as she tries to form a coalition government in the wake of German elections which saw an erosion in the strength of established political parties, which lost seats in parliament to upstart groups.
German stocks snapped a two-session skid, getting a lift as business optimism in the region’s largest economy climbed to a record and as one of Germany’s major political parties cracked the door to possibly breaking a political impasse.
The export-heavy — and euro-sensitive — German DAX 30 benchmark picked up 0.4% to end at 13,059.84, breaking a two-day run of losses. It closed the week up by 0.5%, snapping two weeks of declines.
On the index, chemicals maker BASF topped gainers with a 2.9% rise and car maker Volkswagen moved up 1%.
In Paris, the CAC 40 claimed a 0.2% rise at 5,390.46. In Madrid, the IBEX 35 picked up 0.2% to end at 10,053.50.
Those indexes on a weekly basis rose 1.3% and 0.4%, respectively.
But the U.K.’s FTSE 100 index slipped 0.1% to end at 7,409.64.
That helped keep some pressure on the Stoxx Europe 600, which ended down less than 1 point at 386.63.
Health-care and oil-and-gas stocks led the declining sectors on the pan-European index. But tech, financial and basic-material shares closed up.
For the week, the Stoxx 600 rose 0.7% and that’s the first weekly rise in three.
In Asian trading Friday, the Shanghai Composite Index edged up 0.1% after falling 2.3% Thursday in its biggest one-day drop in nearly a year.
The steep declines followed signs of Beijing’s determination to clamp down on market speculation and the country’s high debt levels. Weakness in China’s bond market also contributed to the downbeat tone as the 10-year yield recently hit three-year highs of just over 4%.
Hong Kong’s Hang Seng, which slid Thursday along with its mainland counterparts, rose 0.5%, ending the week 2.3% higher.
Japan’s Nikkei finished the day up 0.1% and ended the week up 0.7% following a Thursday holiday.
Important News Events For Today
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