On 28 November, 2016 – Stocks indices were mostly lower

Investors await a decision from OPEC on production cuts.
United States
US stocks retreated Monday after hitting new closing highs in Friday’s abbreviated trading session. The Dow Jones industrials were down 0.3 percent, the S&P declined 0.5 percent and the Nasdaq lost 0.6 percent. Consumer companies and banks were down while some small company stocks retreated after their recent gains. Profit taking also contributed to the declines.
Stocks have staged a rally in November after the election of Donald Trump. Investors have made big bets that Mr Trump along with a Republican-led Congress will push to deregulate energy and banking and cut taxes, which could lead to stronger economic growth.
Amazon declined after analysts cut their price target on the stock, citing deep discounting by the retailer to compete during the holiday shopping season. Barnes & Noble declined on reports that the book seller was also doing deep discounting. Publisher Time jumped after The New York Post reported that the company had rejected a buyout offer from the investor Edgar Bronfman Jr. Wells Fargo, Bank of America and Citigroup retreated. Biotechnology stocks including lder BioPharmaceuticals, Ocular Therapeutix, Celldex and Ophthotech tumbled.
These data reflect observations at 4:00 PM US ET. Gold at the afternoon London fixing was down 70 US cents to US$1,187.00. Copper futures were down 0.6 percent to US$2.67. WTI spot crude was up 88 US cents to US$46.94. Dated Brent spot crude was up 83 US cents to US$48.07. The US dollar was up against the pound. However it declined against the yen, euro, and the Canadian and Australian dollars. It was virtually unchanged against the Swiss franc. The yield on US Treasury 30 year bond was down 2 basis points to 2.98 percent while the yield on the 10 year note was down 5 basis points to 2.31 percent.
Europe
Stocks in Europe retreated — traders were nervous before the OPEC meeting on Wednesday. Uncertainty about whether the members of the cartel will manage to finalize an agreement on reducing oil production continues to weigh on sentiment. Recent optimism about the outcome of the meeting was partly offset by news that Saudi Arabia pulled out of a meeting with non-OPEC oil producing countries scheduled for Monday. The FTSE was down 0.6 percent, the CAC declined 0.9 percent, the DAX lost 1.1 percent and the SMI was 0.7 percent lower.
Investors are also concerned about Italy’s future in Europe’s monetary union ahead of the Italian constitutional reforms referendum on December 4. Italian Prime Minister Matteo Renzi is staking his political future on this referendum that would change the Italian constitution by weakening the upper house of parliament and strengthening the central government. Italian banks were under heavy pressure during Monday’s session.
In remarks to the European Parliament, European Central Bank President Mario Draghi said the Eurozone has proven to be resilient to many shocks this year amid the uncertainty arising from the economic and political environment, largely due to the stimulus measures adopted by the Bank. He noted that inflation has gradually edged up and the ECB’s monetary stimulus has been a key ingredient of the ongoing recovery.
Both Commerzbank and Deutsche Bank declined. Deutsche Lufthansa and Volkswagen retreated. In Paris, BNP Paribas, Credit Agricole and Société Générale finished lower. Technip and Total declined along with BP and Royal Dutch Shell. In London, Man Group tumbled on a broker downgrade. Miner Antofagasta climbed after announcing it had signed an agreement to sell Minera Michilla to Haldeman Mining for $52 million. Randgold Resources and Fresnillo advanced as gold prices climbed. Polymetal International gained. Aberdeen Asset Management dropped after the investment management group posted a drop in full-year revenue and profit from a year ago. Royal Bank of Scotland, Barclays, Lloyds Banking Group, Standard Chartered and HSBC were down.
Asia Pacific
Stocks in Asia were mixed Monday as sliding oil prices weighed on energy stocks. The US dollar retreated against its major peers including the Japanese yen while oil extended Friday’s losses after Saudi Arabia backed out of the non-OPEC meeting slated for Monday. Expectations that an OPEC production deal would unravel dominated Asian trade on Monday, adding volatility to regional stocks and currencies.
Shanghai Composite climbed 0.5 percent as upbeat industrial profits data for October bolstered optimism for China’s growth. Profits at industrial companies rose 9.8 percent in October from a year earlier aided by stronger sales and higher prices. The Hang Seng added 0.5 percent as well after China and Hong Kong securities regulators approved the launch of Shenzhen-Hong Kong Stock Connect for December 5.
The Nikkei edged down 0.1 percent while the Topix added 0.3 percent. Kawasaki Heavy Industries, Softbank, Suzuki Motor, Mitsubishi Motors, Kubota, TDK and Shiseido retreated. However, Sumitomo Mitsui Trust, Nippon Telegraph and Telephone, Mizuho Financial Group, Toshiba and Chubu Electric Power rallied. Energy explorer Inpex and Japan Petroleum were lower.
The S&P/ASX lost 0.8 percent while the All Ordinaries was down 0.7 percent. BHP Billiton fell from a 15-month high reached on Friday while Rio Tinto slipped as well despite Dalian iron ore futures rising about 2 percent today. Oil majors Woodside Petroleum, Santos and Oil Search declined after crude oil prices fell on Friday. Financials also were lower after last week’s rally along with the big four banks.
The Kospi was up 0.2 percent and the local currency hit a one-and-a-half week high as US bond yields dropped and the dollar index slipped from recent peaks. The Sensex was 0.1 percent higher in choppy trading.
Looking Forward
Japan releases October household spending, retail sales and unemployment. France posts third quarter revised gross domestic product and October consumer spending for manufactured goods. The Eurozone releases November EC economic sentiment. In the US, revised third quarter gross domestic product, September Case Shiller house price index and November consumer confidence will be released.
Global Stock Markets

*Note — all releases are listed in local time.

Source: Fidelity

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