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Market Wrap: Stocks, Bonds, Commodities
On Tuesday, U.S. stocks closed higher as market sentiment was lifted by softer-than-expected inflation data. The Dow Jones Industrial Average rose 103 points (+0.30%) to 34,108, the S&P 500 increased 29 points (+0.73%) to 4,019, and the Nasdaq 100 gained 127 points (+1.09%) to 11,834.
In fact, stocks pared gains ahead of the Federal Reserve's interest-rate decision on Wednesday. The S&P 500 once jumped over 2.7% within the session.
U.S. data showed that consumer prices grew only 7.1% on year in November, slower than +7.6% expected and +7.7% in October. Monthly inflation rate was only 0.1% (vs +0.3% expected, +0.4% in October)..
The U.S. 10-year Treasury yield sank 10.8 basis points to 3.503%.
Media (+2.15%), real estate (+2.04%), and semiconductors (+1.85%) sectors led the market higher.
Meta Platforms (META) rose 4.74%, Amazon.com (AMZN) gained 2.14%, Alphabet (GOOGL) climbed 2.49%, Apple (AAPL) edged up 0.68%, while Tesla (TSLA) slid 4.09%.
Moderna (MRNA) surged 19.63%, and Merck & Co (MRK) rose 1.78%. A treatment developed by both company proved to reduce melanoma deaths in a mid-stage trial.
United Airlines (UAL) fell 6.94% after the company announced an order of 100 Boeing 787 jets.
European stocks also closed higher. The DAX 40 rose 1.34%, the CAC 40 increased 1.42%, and the FTSE 100 was up 0.76%.
U.S. WTI crude futures advanced $2.10 to $75.25 a barrel.
Gold price jumped $28 to $1,810 an ounce.
Market Wrap: Forex
The U.S. dollar dropped sharply against other major currencies as softer-than-expected inflation data led investors to anticipate slower interest-rate hikes by the Federal Reserve. The dollar index fell to 104.04.
USD/JPY sank 206 pips (-1.50%) to 135.61.
EUR/USD jumped 93 pips to 1.0630. In Germany, the ZEW economic sentiment index improved to -23.3 in December (vs -27.0 expected).
GBP/USD increased 94 pips to 1.2363. In the U.K., the latest jobless rate edged up to 3.7% (as expected). The number of jobless claims increased 30,500 in November (vs +3,300 expected).
AUD/USD climbed 109 pips to 0.6854.
USD/CHF fell 72 pips to 0.9291, and USD/CAD slid 88 pips to 1.3548.
Bitcoin gained over 3% to $17,700.
Morning Trading
In Asian trading hours, the Bank of Japan reported that its Tankan large manufacturers index fell to 7 (vs 6 expected) in the fourth quarter, while the Tankan large non-manufacturers index rose to 19 (vs 16 expected). Also, core machine orders grew 5.4% on month in October (vs +2.4% expected).
USD/JPY remained subdued at 135.52.
EUR/USD dipped to 1.0623, GBP/USD traded lower to 1.2348, and AUD/USD fell to 0.6827.
Gold price was stable at $1,810 an ounce.
Bitcoin advanced further to $17,820.
Expected Today
In the U.K., the inflation rate is expected to tick down to 11.0% on year and 0.7% on month in November. The retail price index is expected to increase 0.6% on year in November.
The Eurozone's industrial production is expected to decline 1.2% on month in October.
In the U.S., the Federal Reserve is expected to raise its key interest rates by 50 basis points to 4.25-4.50%.
The U.S. Energy Department is expected to report a reduction of 3.595 million barrels in the crude-oil stockpiles. | | |
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