On 10 January, 2017 – Global stocks were mixed Tuesday
Energy shares followed crude prices lower.
United States
After retreating in the morning, banks led stocks mostly higher in late-afternoon trading Tuesday. Trading was lackluster. Health care and consumer goods stocks advanced while real estate companies lagged. Energy stocks declined following a drop in crude oil prices. The Dow Jones industrials were down 0.2 percent while the S&P was virtually unchanged. The Nasdaq added 0.4 percent to close at another all-time high.
Illumina jumped after it reported better-than-anticipated fourth quarter sales. The company also launched a new genetic sequencing system called NovaSeq. Valeant Pharmaceuticals climbed after saying it will sell more than $2 billion in assets. Zimmer Biomet gained after the medical device maker projected better-than-expected fourth-quarter sales. Pacific Continental soared on news that the holding company for Pacific Continental Bank will be bought by Columbia Banking System for $664 million. Alaska Air Group was higher after the airline, which bought Virgin America in December, reported strong monthly results.
Yahoo advanced after the company said it plans to change its name to Altaba and announced that six of its 11 directors will resign from the board, including CEO Marissa Mayer and co-founder David Filo. The moves assume the sale of Yahoo’s internet business to Verizon will go through and reflect how the rest of Yahoo will become a holding company for investments in Alibaba Group and Yahoo Japan. Ascena Retail Group tumbled after the company slashed its profit forecast, citing holiday season sales which declined for most of its store chains including Ann Taylor, Lane Bryant and Dressbarn.
These data reflect observations at 4:00 PM US ET. Gold at the afternoon London fixing was up US$11.00 to US$1,189.50. Copper futures were up 2.86 percent to US$2.61. WTI spot crude was down US$1.16 to US$50.80. Dated Brent spot crude was down US$1.28 to US$53.66. The US dollar was down against the pound, yen, yuan and the Canadian and Australian dollars. However, it declined against the euro and Swiss franc. The Dollar Index was up 0.15 percent. The yield on US Treasury 30 year bond was unchanged at 2.97 percent while the yield on the 10 year note edged up 1 basis point to 2.38 percent.
Europe
European markets mostly gained Tuesday. Shares fluctuated between small gains and losses during the trading session. Bank stocks were under pressure because of renewed concerns over the Italian banking system. Meanwhile, mining stocks surged due to rising copper prices. The FTSE was up for a ninth consecutive session, this time adding 0.5 percent. The SMI was up 0.3 percent and the DAX was 0.2 percent higher. The CAC was virtually unchanged (up 0.66 point).
Lanxess declined on a broker downgrade. SGL Carbon dropped after it agreed to sell its carbon fiber production site in Evanston. In Paris, Total advanced while Tullow Oil declined in London after they have entered into a package agreement under which Total will acquire an additional 21.57 percent interest from Tullow in the Uganda Lake Albert oil project. L’Oréal slipped after the cosmetics group announced a definitive agreement with Valeant to acquire the skincare brands CeraVe, AcneFree and Ambi for a cash purchase price of $1.3 billion.
Wm Morrison Supermarkets climbed after the supermarket operator raised its profit guidance after delivering its strongest performance in seven years. Tesco and J Sainsbury advanced also. Just Eat retreated after its online food orders slowed in the fourth quarter. Mining stocks turned in a strong performance as copper prices increased. Anglo American, Glencore, Rio Tinto and BHP Billiton were higher.
French industrial production rebounded 2.2 percent after slipping 0.1 percent in October.
Asia Pacific
Stocks were mixed Tuesday after oil prices steadied following steep overnight losses and the US dollar remained broadly weaker despite worries over the likelihood of a “hard Brexit” and the prospect of more US rate increases this year.
The Shanghai Composite was down 0.3 percent as investors booked some profits after recent sharp gains on hopes of reforms in state-owned enterprises. Mixed inflation data also dented investor sentiment. December consumer price index was up 2.1 percent on the year, down from 2.3 percent in November. Producer prices jumped 5.5 percent from a year earlier — more than expected. The Hang Seng added 0.8 percent.
The Nikkei was down 0.8 percent and the Topix retreated 0.7 percent after Monday’s holiday. Toyota Motor was down after saying it would invest $10 billion in the United States over the next five years. Takeda Pharmaceutical closed marginally higher after it agreed to acquire cancer drug maker Ariad Pharmaceuticals for $5.2 billion. Investors ignored survey data from the Cabinet Office showing that Japan’s consumer confidence index rose more than expected to hit the highest level in more than three years in December.
Both the S&P/ASX and All Ordinaries lost 0.8 percent as oil prices tumbled on doubts over the effectiveness of OPEC’s agreed supply cuts and official data showed retail sales in Australia rose less than expected in December. Oil Search, Beach Energy and Santos dropped after crude futures dropped the most in more than five weeks overnight amid signs of growing US production and record Iraqi exports. The big four banks were lower while miners Rio Tinto and Fortescue Metals Group advanced. Gold miners Regis Resources, Evolution Mining, Newcrest and Northern Star also climbed after gold prices hit a five-week high on a weaker dollar.
The Kospi was down 0.2 percent. The Sensex was 0.6 percent higher.
Looking Forward
The UK posts November industrial production and merchandise trade balance. In the US, the petroleum status report will be released.
Global Stock Markets
*Note — all releases are listed in local time.
Source: Fidelity
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