July 19, 2016

IFC Markets, Market Overview - US stocks climb to record highs on positive earnings reports

This article is originally referred from IFC Markets Market Overview.

US stocks closed at record highs on Monday boosted by strong earnings reports. The dollar weakened as currency markets calmed after a Turkish government reasserted control over the country following a failed coup attempt.

According to the live dollar index data the ICE US Dollar Index, a measure of the dollar’s value against a basket of six major currencies, slipped 0.1% to 96.514.

The Dow Jones industrial average rose 0.1 % settling at 18533.05, the fifth straight record close, led by DuPont and Home Depot. The S&P 500 gained 0.2% ending at 2137.16 led by technology and materials stocks. Five out of ten main sectors closed in positive territory.

The Nasdaq Composite Index added 0.5% closing at 5055.78, a new closing high. Stocks were supported by better than expected earnings from financial companies, with technical stocks rallying on news Japan’s SoftBank Group is buying ARM Holdings, a major supplier for Apple. Stocks rose as earnings reports beat expectations while companies are selling at high price to earnings ratios.

In economic news home builder confidence index slipped one point to 59 in July, an industry group said Monday. Today at 14:30 CET June Housing Starts and Building Permits will be released. The tentative outlook is positive for dollar.

European stocks ended higher on Monday led by a 41% rise in British chip maker ARM Holdings on news about $32 billion all cash buyout offer by Japanese telecom company Softbank Group. Losses in travel and financial stocks after coup attempt in Turkey limited gains in stocks. The euro strengthened against the dollar as did the British Pound.

The Stoxx Europe 600 gained 0.2%. Germany’s DAX 30 index edged down less than 0.1% to finish at 10063.13. France’s CAC 40 index lost 0.3% while the UK’s FTSE 100 index closed 0.4% higher. SBM Offshore NV jumped 15% after the Dutch oil services company agreed to pay $341.8 million in fines in a leniency deal struck with Brazilian authorities investigating corruption at oil giant Petrobras.

Today at 10:30 CET June Consumer Price Index will be released in UK. The tentative outlook is positive for Pound. At 11:00 CET July ZEW Economic Sentiment for Germany and euro-zone will be published. The tentative outlook is negative for euro.

Asian stocks are edging lower today after MSCI’s broadest index of Asia-Pacific shares outside Japan hit a nine-month high last week. Hong Kong’s Hang Seng Index is down 0.4% with Shanghai Composite Index 0.5% lower after yuan fell below 6.7 per dollar level the previous day. Australia’s All Ordinaries Index is down 0.18%. Nikkei rose for sixth straight session today gaining 1.4% as yen slid against the dollar. Nintendo jumped 14.4% on continued global success of the Pokemon GO mobile game while SoftBank Group dropped 10.3% on concerns the $32 billion ARM Holdings buyout deal will add to its already large debt burden.

Oil futures prices are extending losses today as the global crude oil inventories overhang weighs on prices, despite an expected cut in US shale oil production. September Brent crude declined 1.4% to $46.96 a barrel on London’s ICE Futures exchange on Monday.

Gold is steady today after spot gold dropped 1% on Monday.

Original Source: IFC Markets Market Overview

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