On 15 August, 2016 – Stocks mixed in thin trading

US indices once again hit all-time highs.
United States
Once again the Dow Jones Industrials, S&P and Nasdaq closed at record highs on Monday. Energy companies climbed with the price of oil. Chemical and mining companies also gained. Both the Dow and S&P added 0.3 percent and the Nasdaq was 0.6 percent higher.
Transocean, National Oilwell Varco and ConocoPhillips advanced. Toll Brothers and Lennar rallied. LyondellBasell Industries and Freeport-McMoRan climbed along with Alcoa gained. Phone companies and utilities lagged the market with both Southern Company and AT&T retreating. Nordstrom and Kohl’s advanced. Post Properties jumped after Mid-America Apartment Communities agreed to buy the company for about $3.9 billion. Xylem Inc. climbed after agreeing to acquire Sensus for about $1.7 billion to enhance technology offerings in water distribution and treatment.
In economic news, the August Empire State business conditions index reading came in slightly below zero at minus 4.21 after plus 0.55 in July. New orders were especially flat and unfilled orders extended a long run of negative readings. August housing market index rose 2 points to 60 for the second time this year. Readings over 50 indicate optimism over pessimism.
These data reflect observations at 4:00 PM US ET. Gold at the afternoon London fixing was down US$12.80 to US$1,339.40. Copper futures were up 0.4 percent to US$2.16. WTI spot crude was up US$1.39 to US$45.88. Dated Brent spot crude was up US$1.52 to US$48.49. The US dollar was down against the euro, Swiss franc and the Canadian and Australian dollars. However, it declined against the pound and was unchanged against the yen. The Dollar Index was down 0.2 percent. The yields on both the US Treasury 30 year bond and 10 year note were up 5 basis points to 2.28 and 1.56 percent respectively.
Europe
Stocks were mostly higher in choppy trading. Global growth concerns have made investors cautious after weak US retail sales on Friday and Japanese GDP numbers Monday. Energy stocks advanced as crude oil continued to rise on hopes for a production cap when OPEC nations hold talks in September. The FTSE was up 0.4 percent, the DAX was 0.2 percent higher and the SMI edged up 0.1 percent. The CAC slipped 0.1 percent. Markets in Italy were closed for a national holiday.
The UK vote to leave the European Union is expected to have a limited impact on the German economy as business expectations remained strong according to the latest Bundesbank latest monthly report. Despite the ongoing intense debate on the economic impact of the British vote, the German companies’ positive expectations were only slightly dampened, the bank said. This supports the view that economic impact of the “Brexit” is likely to be within narrow limits, at least in the short term, the bank added.
Automakers Volkswagen, BMW, Daimler, Peugeot and Renault advanced. In London, William Hill dropped after it spurned yet another offer from 888 Holdings and Rank Group consortium. Bovis Homes retreated even though it reported higher first half profits and revenues and also said it sees strong trading through the rest of the year. Royal Dutch Shell and BP gained after the price of oil hit an August high on speculation about potential producer action to prop up prices in an oversupplied market. Sage Group edged up after declining earlier in the day after the business software firm said an internal login had been used to gain unauthorized access to the data of some of its British customers. Anglo American gained. Analysts cited media reports that South Africa’s Public Investment Corporation (PIC), its largest shareholder, is seeking to split up Anglo American’s platinum businesses.
Asia Pacific
Shares were mixed in Monday trading following the release of disappointing Japanese gross domestic product for the second quarter. Indian and the South Korean markets were closed for public holidays.
The Nikkei lost 0.3 percent after second quarter gross domestic product was virtually unchanged on the quarter and up an annualized pace of only 0.2 percent — much less than the forecast of 0.5 percent. Hokuetsu Kishu Paper, Citizen Holdings and Sumitomo Metal Mining ended lower on the day. The S&P/ASX was up 0.2 percent while the All Ordinaries added 0.1 percent at the close after declining early in the day. BHP Billiton, Fortescue and Rio Tinto tumbled. Gold miner Newcrest retreated after earnings just missed forecasts. Energy stocks including Santos gained while Woodside edged down. Telstra and Qantas advanced.
The Shanghai Composite jumped 2.4 percent while the Hang Seng added 0.7 percent. The gains here were on market speculation that an announcement concerning the linking of the Shenzhen Exchange and Hong Kong will be announced soon. The Hong Kong Economic Journal reported Monday that the trading link could be announced as soon as this week and that it would be officially launched in December. The China Securities Regulatory Commission said last Friday that it had formed a special work team with its Hong Kong counterparts to prepare to launch the link. The scheme would let Hong Kong investors buy Shenzhen stocks, and Shenzhen investors buy Hong Kong stocks.
Looking forward
The Reserve Bank of Australia publishes minutes from its policy meeting two weeks ago. The UK posts July consumer and producer price indices. Germany posts August ZEW survey. The Eurozone reports June merchandise trade data. In the US, July data for the consumer price index, housing starts and industrial production will be released.
Global Stock Markets

*Note — all releases are listed in local time.

Source: Fidelity

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