Mid-Day Update: Wall Street Rally Fueled by Trade Hopes, Oil's Rebound, Hopes For Dovish Tilt to Fed



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Ahead of President Donald Trump’s meeting with Chinese president Xi Jinping and events that could shed light towards a dovish tilt in Federal Reserve monetary policy, stocks were rallying Monday, ending a four-day losing streak for the Dow Jones Industrial Average. Led by gains in energy and financial shares, the blue chip index was trading more than 300 points higher at midday, pacing gains in other major market indices.

Buying erupted overnight in Europe when Italy’s deputy prime minister offered an olive branch to the European Commission by signalling Rome’s willingness to lower its deficit/GDP target to as low as 2.0% from 2.4%. Italy’s main stock index rallied almost 3% while the yield on the Italian 10-year government bond plummeted 14 basis points. Led by gains in banking and automobile stocks, European bourses were all significantly higher with Germany’s DAX in the lead with a 1.5% gain.

Global markets were also buoyed by a substantial gain in oil futures despite increased Saudi Arabian production and jawboning by President Trump. After last week’s carnage, Brent crude oil futures bounced back as much as 3% on short-covering ahead of a possible meeting between Saudi and Russian oil ministers this week that is expected to address recent price fluctuations.

Robust preliminary Cyber Monday retail sales data overshadowed this morning’s economic data. The Chicago Fed national activity index improved to a greater-than-expected 0.24 in October from 0.17 the prior month, beating 0.20 estimates.

A corresponding index from the Dallas Fed, however, indicated a contraction in the manufacturing sector as the index fell to 17.6 from 29.4 in October, missing 28.6 estimates.

In corporate news, shares of General Motors ( GM ) rallied as much as 6% to their highest level since July following the company’s announcement to shutter several plants, cut its workforce by 15%, and double the amount of resources allocated to electric and autonomous vehicles.

Crude oil was up $1.25 to $51.67 per barrel. Natural gas was down $0.12 to $4.1 per 1 million BTU. Gold was down $0.50 to $1,222.90 an ounce, while silver was down $0.02 to $14.22 an ounce. Copper was down $0.006 to $2.76 per pound.

Among energy ETFs, the United States Oil Fund was up 0.92% to $10.92 with the United States Natural Gas Fund down 6.21% to $34.18. Amongst precious-metal funds, the Market Vectors Gold Miners ETF was up 0.17% to 19.42 while SPDR Gold Shares were down 0.12% to $115.63. The iShares Silver Trust was down 0.22% to $13.39.

Here’s where the markets stand at mid-day:

US MARKETS

NYSE Composite Index was up 135.12 points (+1.12%) to 12,171.79

Dow Jones Industrial Index was up 254.64 points (+1.05%) to 24,540.59

S&P 500 was up 33.39 points (+1.27%) to 2,667.21

Nasdaq Composite Index was up 89.26 points (+1.29%) to 7,028.33

GLOBAL SENTIMENT

FTSE 100 was up 91.55 points (+1.32%) to 7,044.41

DAX was up 171.15 points (+1.53%) to 11,363.84

CAC 40 was up 54.69 points (+1.11%) to 5,001.64

Nikkei 225 was up 166.45 points (+0.76%) to 21,812.00

Hang Seng Index was up 448.50 points (+1.73%) to 26,376.18

Shanghai China Composite Index was down 3.67 points (-0.14%) to 2,575.81

NYSE SECTOR INDICES

NYSE Energy Sector Index was up 171.90 points (+1.69%) to 10,368.06

NYSE Financial Sector Index was up 125.14 points (+1.68%) to 7,593.97

NYSE Healthcare Sector Index was up 69.41 points (+0.44%) to 15,803.60

UPSIDE MOVERS

(+) EDGE (+10%) Agreed to merge with privately-held PDS Biotechnology

(+) RSLS (+9.60%) Reported potential of new type 2 diabetes treatement

(+) INPX (+9.20%) Announced rights offering

DOWNSIDE MOVERS

(- ) ZFGN (-43.19%) FDA placed clinical hold on INDA ZGN-1061

(-) OSTK (-16.82%) CEO said Friday he plans to sell retail business to focus on blockchain

(-) PLT (-8.03%) No longer in acquisition talks with Logitech ( LOGI )


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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