On 23 November, 2016 – Global stocks were mixed

Trading in the US was light before the US Thanksgiving holiday.
United States
The Dow Jones industrials closed at yet another record high Wednesday gaining 0.3 percent. The S&P edged up 0.1 percent but the Nasdaq retreated 0.1 percent. There was little reaction to the minutes of the November 2 FOMC meeting. Investor expectations remained high that the Fed will raise rates at its December 13 and 14 FOMC meeting. Trading volume was light with many traders leaving work early in advance of Thursday’s Thanksgiving Day holiday.
Eli Lilly dropped after the company said it would stop developing its Alzheimer’s drug following a trial failure. Biogen and Merck, which are developing a similar drug, also declined. Caterpillar advanced. Deere climbed to a record high after reporting a much smaller-than-expected decline in profit. Juno Therapeutics tumbled after reporting that two patients died during a trial of its leukemia drug. United Technologies, which makes elevators, jet engines and other products, gained. Jacobs Engineering Group also advanced. HP declined after it issued a profit forecast that disappointed investors.
The Federal Reserve published minutes of its November 2 FOMC meeting. At that time, by a vote of 8 to 2, the FOMC kept its Fed funds rate range at 0.25 percent to 0.50 percent. According to the minutes, FOMC members generally agreed that the case for an interest rate increase had strengthened but at the same time, a majority wanted more evidence that inflation was picking up. Some members said that an increase should occur at the December meeting barring some external shock. In any event some said an increase should happen ‘soon’. Some FOMC members argued the increase “should occur at the next meeting” if the Fed were to “preserve credibility” as policymakers had thoroughly prepared markets for such a move through public comments in recent weeks.
These data reflect observations at 4:00 PM US ET. Gold at the afternoon London fixing was down US$26.90 to US$1,185.35. Copper futures were up 2.7 percent to US$2.63. WTI spot crude was down 3 US cents to US$48.00. Dated Brent spot crude was down 11 US cents to US$49.01. The US dollar was up against the yen, euro, Swiss franc, yuan and the Canadian and Australian dollars. However, it declined against the pound. The Dollar Index was up 0.8 percent. The yield on US Treasury 30 year bond was up 3 basis points to 3.03 percent while the yield on the 10 year note was up 5 basis points to 2.36 percent.
Europe
Stocks were mostly lower Wednesday. However, losses were pared as they neared the close. The markets were initially positive, but most slipped by midday into negative territory. The FTSE was virtually unchanged (down 1.63 points), the CAC was down 0.4 percent and the DAX lost 0.5 percent. The SMI however, edged up 0.1 percent. Crude oil prices struggled as traders became skeptical that OPEC members will reach an agreement on production cuts at their meeting next week.
According to Chancellor of the Exchequer Philip Hammond’s first budget presentation after the ‘Brexit’ vote in late June the UK economic growth will slow next year and the government will no longer aim to balance its budget by 2020. The reasons given were the high uncertainty and weaker growth outlook. The growth forecast for next year was slashed to 1.4 percent from 2.2 percent predicted in the March budget by Hammond’s predecessor George Osborne. The expected sharp slowdown in growth next year was attributed to lower investment and weaker consumer demand thanks to the greater uncertainty stemming from Brexit and by higher inflation resulting from sterling depreciation.
Volkswagen gained after the automaker said it would drop diesel vehicles in the United States and refocus on sport utility and electric vehicles. Deutsche Lufthansa increased even though the airline said it had cancelled 876 of 3,000 scheduled flights Wednesday due to a pilots’ strike. Infineon Technologies rose after the company boosted its 2017 margin forecast. Vinci rose after denying media reports that it would restate its accounts and sack its chief finance officer.
Safran was lower after the French state began selling a stake in the defense equipment group through the institutional placement route. Vivendi dropped after the company said that it has purchased additional Telecom Italia ordinary shares on the market in order to bring its participation back to previous levels. Thomas Cook Group advanced after the tour operator resumed its dividend and said trading was in line with management expectations. The Paragon Group of Companies advanced after it announced a share buyback after improving its FY pretax profit to £143.2 million from £134.2 million last year. GlaxoSmithKline edged up after the company filed a regulatory submission with the US Food and Drug Administration for its new three-in-one inhaled lung therapy.
The Eurozone flash composite November PMI climbed to an 11-month high of 54.1 from 53.3 in October. Germany’s composite flash PMI eased to 54.9 from 55.1 the month before. French composite flash PMI reading was 52.3, up from 51.6 the month before.
Asia Pacific
Shares were mostly higher Wednesday even though the US dollar continued to strengthen and rising bond yields implied faster-than-expected rate increases by the Federal Reserve going forward. Oil prices traded slightly lower in Asia after reports that Iran and Iraq are not ready to agree on an OPEC output freeze. Markets in Japan were closed for a holiday.
The Shanghai Composite slipped 0.2 percent while the Hang Seng was virtually unchanged (down 1.38 points).
Both the S&P/ASX and All Ordinaries added 1.3 percent, helped by strength in commodity prices on expectations of continued demand from China and improved US demand. Miners BHP Billiton, Rio Tinto and Fortescue Metals Group rallied after iron ore prices jumped 7 percent overnight. The big four banks rose as yields on Australian 10-year bonds hit their highest level since January.
The Kospi was up 0.2 percent on continued buying by foreign investors. The Sensex was up for a second day, this time by 0.4 percent.
Looking Forward
On Thursday, Japan posts flash November manufacturing PMI. Germany reports a revised third quarter GDP and November Ifo survey. All US markets are closed for the Thanksgiving Day holiday.
On Friday, Japan posts October consumer price index. The UK reports revised gross domestic product. In the US, international trade in goods for October along with the weekly money supply and Fed balance sheet will be released. The US stock market closes at 1 pm ET.
Global Stock Markets

*Note — all releases are listed in local time.

Source: Fidelity

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