On 09 February, 2017 – Global stocks mostly higher
The Dow, S&P and Nasdaq close at record highs.
United States
Three US stock indices closed at record highs Thursday after President Donald Trump said he would make a major tax announcement in a few weeks. Financials were the best performing group. The Dow Jones industrials, S&P and Nasdaq gained 0.6 percent each. Energy stocks were up following a rise in crude oil prices.
Gannett climbed after the publisher of USA Today and other newspapers turned in better-than expected earnings. Viacom gained after it released its latest quarterly results and the media giant’s plans to turn its business around. Kellogg rose after the company released earnings that beat expectations. Restaurant operator Yum Brands was higher as earnings were better-than-expected and as stronger US sales at KFC and Taco Bell offset weakness at the company’s Pizza Hut chain.
Dunkin’ Brands climbed after its earnings beat expectations. Twitter slumped after releasing its latest quarterly earnings, which topped expectations but were overshadowed by a weak profit forecast. Coca-Cola traded lower after its profit fell 55 percent in the most recent quarter. Coty tumbled after the beauty products maker’s latest quarterly results fell short of estimates. Apple advanced. Airlines JetBlue, American and Delta rallied. Prudential gained after releasing its results.
Weekly jobless claims dropped 12,000 to 234,000 from the previous week’s unrevised level of 246,000. With the unexpected decrease, jobless claims fell to their lowest level since hitting a more than 40-year low of 233,000 in the week ended November 12th.
These data reflect observations at 4:00 PM US ET. Gold at the afternoon London fixing was down US$5.30 to US$1,236.80. Copper futures were down 0.3 percent to US$2.66. WTI spot crude was up 74 US cents to US$53.08. Dated Brent spot crude was up 53 US cents to US$55.65. The US dollar was up against the yen, euro, pound, Swiss franc and the Australian dollar. The currency declined against the Canadian dollar. The Dollar Index was up 0.4 percent. The yield on US Treasury 30 year bond was up 6 basis points to 3.01 percent while the yield on the 10 year note was up 7 basis points to 2.40 percent.
Europe
Stocks advanced Thursday. The main focus among investors was on corporate earnings but a rebound in crude oil prices also provided a lift to sentiment. The FTSE was up 0.6 percent, the CAC jumped 1.3 percent, the DAX gained 0.9 percent and the SMI was 0.7 percent higher.
Defensive stocks were among the best performers Thursday, as global uncertainties continued to persist. Traders monitored news from the White House as President Trump continues to implement his policies. Concerns over the upcoming European elections also continue to linger. Strong results from Total and Société Générale helped to drive the markets higher.
Commerzbank retreated after its fourth-quarter net profit was hit by a sharp rise in provisions against bad loans on ship finance. ThyssenKrupp tumbled after the company swung to a net profit in the first quarter of its fiscal year 2017, but warned that it expects a recovery in its European steel business only later in the year. Infineon Technologies was lower. The company and U.S. LED lighting maker Cree have announced that Cree’s proposed $850 million sale of its Wolfspeed Power unit to the German chipmaker is unlikely to be approved by the Committee on Foreign Investment in the United States. Total SA advanced after the oil major swung to a net profit in the fourth quarter after cutting costs at all its units. Société Générale increased even though the lender reported a drop in fourth-quarter net profit due to the negative impact of higher taxes and the sale of its Croatian subsidiary.
Eutelsat surged after the company unveiled plans to buy a ViaSat satellite. Publicis Groupe slid after it reported a loss of €527 million for fiscal 2016. Aviva advanced — the life and health insurer is selling its entire 50 percent holding in French life insurance joint venture Antarius to Sogecap, a unit of Société Générale for about £425 million or €500 million. Thomas Cook Group sank after its first-quarter pretax loss widened due to higher costs. BHP Billiton was lower after its board approved expenditures of $2.2 billion for its share of the development of the Mad Dog Phase 2 project in the Gulf of Mexico. Smith & Nephew was lower after reporting a 7 percent drop in full-year trading profit.
Germany’s December trade surplus was €18.4 billion. Exports were down 3.0 percent on the month while imports were virtually unchanged. On the year, exports were up 6.3 percent and imports, 7.4 percent.
Asia Pacific
Stocks were mostly higher with the exception of Japanese shares. Trading volumes remained thin in the wake of growing concerns over political instability in Europe and uncertainty over US President Donald Trump’s policies.
The Shanghai Composite was up 0.5 percent on reports that China would step up supply-side reforms and reduce overcapacity in the construction materials sector. The Hang Seng added 0.2 percent.
Both the Nikkei and Topix retreated as investors waited for news from Prime Minister Shinzo Abe’s meeting with US President Donald Trump Friday in Washington. Investors ignored better-than-expected core machinery orders data. Core machine orders jumped 6.7 percent in December after sinking 5.1 percent in November. The Nikkei and Topix lost 0.5 percent and 0.7 percent respectively. Auto stocks led declines, with Honda, Mazda, Nissan, Toyota and Fuji Heavy Industries all declining. Nisshinbo was down on a Nikkei report that it has decided to pull back plans for a Mexico plant. Hitachi dropped after news that Mitsubishi Heavy Industries had asked it to pay 89.7 billion rand to cover costs from their joint South African power plant project.
The S&P/ASX and All Ordinaries were up 0.2 percent and 0.3 percent respectively. AGL Energy rallied after the electricity and gas retailer delivered profits above expectations and increased the interim dividend. Wealth manager AMP climbed after announcing an A$500 million share buyback. BHP Billiton and Fortescue Metals Group retreated despite higher commodity prices. Rio Tinto was lower despite announcing it would pay a bigger-than-expected dividend and buy back $500 million worth of its own shares.
The Kospi was virtually unchanged (up 0.80 point) as foreign investors turned buyers after selling. The Sensex edged up 0.1 percent.
Looking Forward
Japan posts January producer price index. India, France, Italy and the UK release December industrial production. The UK also reports December merchandise trade balance. Canada reports January labour force survey. The US releases January import and export prices and preliminary February consumer sentiment.
Global Stock Markets
*Note — all releases are listed in local time.
Source: Fidelity
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