Glum Crude Forecast Could Jolt the Market!
Trading on Wall Street was conducted to the tune of the continued tailspin in crude and energy stocks, adding to investors’ concerns about low inflation. The biotech and tech sector helped push the NASDAQ higher.
The energy sector (XLE) was the weakest sector yesterday with declines of 1.6% after crude changed directions not long after trading began, hitting a low not seen since August – and that was despite a larger than expected decline in weekly reserve figures. The persistent weakness in crude compounded investors’ concerns about inflation, and as a result, also rippled through industrial and banking stocks. The banking sector (KBE) closed off 0.8%, investors concerned that banks’ margins will continue to be slashed, inflation being so low. Crude closed off by 2.3% at the $42.53 barrel level.
The energy sector (XLE) has fallen 14.9% year-to-date, stacked up against the 8.9% gains on the S&P 500. Crude is off 21% year-to-date, having now entered a bear market.
Investors seeking stocks offering growth opportunities turned yesterday to the NASDAQ, which boasts many tech and biotech stocks. Biotech stocks got a boost from reports that Trump’s agenda for reining in drug prices will, when push comes to shove, be more conducive to the sector than once thought.
Daily Summary: The Dow Jones fell 0.27%, the S&P 500 shedding 0.06%, and the NASDAQ rising 0.74%.
The biotech sector (IBB) soared 4.1%, with its strongest day of gains since the November 8th elections. Two of the stocks that stood out in the sector – CELG and REGN – each rallied over 5%, BIIB soaring 4.7%.
About 7.16 billion shares changed hands on U.S. exchanges, pretty much on par with the 6.92 billion average over the last 20 trading days.
Thursday: Crude will continue to command a lot of attention, the next key level being $40 per barrel. A breakdown of this level, and the rules of the game could change entirely, setting off a wave of pessimism in the market as a whole.
Today’s Economic Diary will include last week’s initial unemployment claims at 8:30 N.Y. time. At 9:00, the FHFA contractors’ union home price index will be coming out.
The earnings reports to keep your eyes out for today include: ACN, BBBY, BKS, and CCL.
Thursday’s Hot Stocks: HAIN, ORCL, SCS
IPOs: ATUS, SAFE
Have a great trading day!
|Tuesday||8:30||Current Account Balance||-$123.4B||Medium|
|Wednesday||10:00||Existing Home Sales||5.52M||Medium|
|Wednesday||10:30||Crude Oil Inventories||–||Low|
|Thursday||9:00||FHFA Housing Price Index||–||Medium|
|Friday||10:00||New Home Sales||599K||Medium|
|RHT||Red Hat, Inc.||PM||Tuesday|
|ADBE||Adobe Systems Incorporated||PM||Tuesday|
|CACI||CACI International Inc||PM||Wednesday|
|HAIN||The Hain Celestial Group, Inc.||AM||Thursday|
|CMC||Commercial Metals Company||PM||Thursday|
|BBBY||Bed Bath & Beyond Inc.||PM||Thursday|
Today’s Picks – Day Trading!
New York Strategy Swing