Month: November 2019

The Dow Jones Industrial Average rallied on Monday thanks to a surge in Boeing (BA) shares. The Dow component advanced 4.61 percent after it stated the 737 MAX could restart delivery as soon as next month. The DJIA climbed 0.05 percent.

SPDR Utilities (XLU) fell 0.65 percent on Monday. Bond markets were closed for the Veteran’s Day holiday, but investors are still expecting rising interest rates. SPDR Technology (XLK) and SPDR Industrials (XLI) both gained 0.06 percent.

The National Federation of Independent Business will report its small business confidence index for October this week. The Bureau of Labor Statistics’ calculation of consumer and producer price inflation will be out midweek. Analysts forecast a 0.3 percent increase in headline inflation and 0.2 percent in core CPI. Producer prices are forecast to have risen 0.3 percent after falling 0.3 percent in September.

Federal Reserve Chairman Jerome Powell will testify before Congress on Wednesday and Thursday. Other Fed officials will make public appearances over the coming days.

Retail sales for October are out on Friday. Economists see headline sales rising 0.2 percent and sales ex-autos climbing 0.4 percent.

The U.S. Dollar Index pulled back 0.15 percent on Monday as the Conservative party polled strongly ahead of the December 12 parliamentary election in the United Kingdom. Nigel Farage of the Brexit Party also announced his party would not challenge Conservative candidates in most districts. A secure majority will hand Prime Minister Boris Johnson enough votes for a final Brexit deal with the European Union. The pound rallied 0.60 percent on Monday.

Chinese money supply growth was slower than expected in October. This news weighed on materials shares. Global X Copper Miners (COPX) slid 1.53 percent. iShares China Large Cap (FXI) fell 1.54 percent, which in turned pulled iShares MSCI Emerging Markets (EEM) lower by 0.71 percent.

Earnings season has started winding down, but retailers start reporting this week along with a few remaining blue chips. On Tuesday, investors will hear from Tyson Foods (TSN), Skyworks Solutions (SWKS), D.R. Horton (DHI), CBS Corp (CBS), Rockwell Automation (ROK) and Tilray (TLRY).

Cisco (CSCO), NetApp (NTAP), Canadian Goose (GOOS), Energizer (ENR) and Teekay Tankers (TNK) also report.

On Thursday, retail giant Wal-Mart (WMT) reports along with Nvidia (NVDA), Applied Materials (AMAT), Weibo (WB), Viacom (VIAB) and Brookfield Asset Management (BAM). Friday brings earnings from J.C. Penney (JCP), JD.com (JD) and Helmerich & Payne (HP).

Equities climbed to new all-time highs on positive economic data and solid earnings news. The Dow Jones Industrial Average advanced 1.36 percent. The S&P 500 Index gained 0.90 percent and the Nasdaq 1.05 percent.

Rising interest rates boosted the financial sector. SPDR Financial (XLF) increased 2.54 percent. SPDR S&P Regional Bank (KRE) rallied 3.27 percent. Rising oil prices enabled SPDR Energy (XLE) to gain 2.28 percent. SPDR Industrial (XLI) rose 1.93 percent.

Economic data was solid. The ISM services index increased to 54.7 percent and beat expectations. The Job Openings and Labor Turnover Survey (JOLTS) still shows more job openings than unemployed Americans. Initial unemployment claims were 211,000.

The 10-year Treasury yield climbed to 1.93 percent this week, up from 1.7 percent. iShares Barclays 20+ Year Treasury (TLT) slumped 4.00 percent. Corporate and investment grade bonds also slid as interest rate risk chipped away at longer-duration bond valuations. Both high-yield and floating-rate funds gained on the week.

The U.S. Dollar Index was a beneficiary of rising rates. It increased 1.24 percent for the week. iShares MSCI Emerging Markets (EEM) increased 1.06 percent on increased optimism over a trade deal with China. MSCI EAFE (EFA) advanced 0.53 percent.

Crude oil closed the week at $57.24 per barrel. Natural gas extended its rally as cold weather swept across the northern part of the U.S., finishing the week at $2.79 per mmBTU. Natural gas was trading at $2 mmBTU in August.

Disney (SID) was one of the many companies beating earnings forecast this week. Shares advanced 3.91 percent.

Xerox (XRX) launched a bid for Hewlett-Packard (HPQ). Normally the acquirer’s shares drop on takeover news, but Xerox outperformed HP, rising 16.04 percent to the latter’s 9.79 percent. Xerox is only one-third the size of HP, and it’s offering $17 in cash plus shares to make for a $22 per share offer. HP said the offer undervalued the company and doesn’t think it will benefit shareholders. Analysts also considered it a low offer. Xerox’s move could spur further activity if cash-rich tech giants move to block a merger with better offers.

The Dow Jones Industrial Average joined the S&P 500 Index and Nasdaq at new all-time highs on Monday. The Nasdaq increased 0.56 percent, the Dow 0.42 percent and the S&P 500 Index 0.37 percent. Stocks rallied as Asian markets priced in strong U.S. employment data from Friday, as well as indications the U.S. and China were moving towards a “phase 2” agreement.

Crude oil rose only 0.62 percent on Monday, but energy stocks jumped. Exxon Mobil (XOM) and Chevron (CVX) climbed 3.00 percent and 4.62 percent, respectively. Independent producers were among the largest gainers in the S&P 500 Index, with several climbing more than 5 percent on the day. SPDR Energy (XLE) advanced 3.31 percent. Industrials were the second-best performing sector, with SPDR Industrials (XLI) increasing 1.18 percent.

Services PMIs will be out midweek. The Jobs Openings and Labor Turnover Survey (JOLTS) for September and the University of Michigan’s advance consumer sentiment survey for November will be other notable data releases.

The U.S. Dollar Index climbed 0.40 percent on Monday. iShares MSCI EAFE (EFA) and iShares Emerging Markets (EEM) increased 0.51 percent and 0.97 percent, thanks to optimism over Brexit and China-U.S. trade relations.

The 10-year Treasury yield hit 1.79 percent and has recovered almost all of its decline following the recent Fed meeting. Traders “bought the news” of the Fed rate cut after shorting bonds going into the meeting. Strong economic data and the Fed shifting its policy to a more neutral stance have begun lifting interest rates. Capital is also flowing out of bonds and into stocks after a choppy summer and early autumn.

Berkshire Hathaway (BRK.B) reported a 14 percent increase in operating earnings last quarter, but its net earnings per share fell because it had to mark down some of its holdings in other companies. The company had $128 billion in cash and short-term investments at the end of September.

Tuesday will see earnings from Allergan (AGN), Becton Dickinson (BDX), Regeneron Pharmaceuticals (REGN), Newmont Mining (NEM), Emerson Electric (EMR), Devon Energy (DVN), Tapestry (TPR) and HubSpot (HUBS).

Roku (ROKU), Fitbit (FIT), Square (SQ), Qualcomm (QCOM), CVS Health (CVS), Expedia (EXPE) and Wynn Resorts (WYNN) are among those reporting on Wednesday.

Disney (DIS) headlines Thursday’s earnings reports. Activision Blizzard (ATVI), Trade Desk (TTD), Monster Beverage (MNST), Johnson Controls (JCI), Air Products (APD), Cardinal Health (CAH), AmerisourceBergen (ABC) and Planet Fitness (PLNT) are other notable reports.

Duke Energy (DUK), Enbridge (ENB) and Honda Motor (HMC) close out the week.