Friday, November 24, 2017

Markets hit records on hopes for holiday spending

Dow rose 45, advancers over decliners 3-2 & NAZ added 12.  The MLP index was fractionally higher in the 259s & the REIT index gained 1+ to the 361s.  Junk bond funds went up & Treasuries were sold.  Oil climbed in the 58s (more below) & gold gave back 4, taking it to 1287.

AMJ (Alerian MLP Index tracking fund)

CL=FCrude Oil58.72

GC=FGold   1,289.70

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Bonds dropped & commodities gained as US stocks opened higher at the traditional start of the American holiday shopping season.  The S&P 500 rose to a new high at the open of a shortened post-Thanksgiving trading session.  Stocks in Europe pared earlier gains as the € headed for a 2-month high, while bonds fell as Germany moved closer to ending a political impasse & business confidence in the region's biggest economy improved.  The $ edged lower even as Treasury yields rose.  US retailers are trying to build on a generally positive earnings season as shoppers descend on their stores looking for “Black Friday” bargains.  The S&P retailer index started the day higher.  Italian banks led an advance in the Stoxx Europe 600 Index, buoyed by a new proposal to deal with bad loans.  Higher Treasury yields weren't enough to sustain early gains in the $, which headed for a 3rd weekly loss.  Iron ore climbed to as Germany's biggest opposition party said it’s open to talks on backing a government led by Chancellor Angela Merkel, offering a way to restore political stability to Europe's biggest economy.  A jump in German business confidence in Oct added to positive sentiment, with global stocks heading into the final weeks of 2017 at record highs as investors place their faith in economic growth & earnings’ expansion, while industrial metals headed for the best weekly gain in 6.  Crude oil rose to a 2-year high as OPEC & Russia were said to have agreed on a framework to extend supply cuts. 

Stocks Climb as Retailers Gain on Black Friday: Markets Wrap

As Black Friday shoppers descend on stores this weekend, retailers are experiencing something that's been in short supply: optimism.  Brick-&-mortar chains are coming off a generally positive earnings season, with companies seeing their shares reach record highs.  Even the beleaguered department-store industry is finding reasons for hope.  Retailers are now taking that spirit into Black Friday weekend, which traditionally kicks off the holiday shopping season.  While the event has lost some of its buzz in recent years -- there will probably be smaller crowds and fewer shoppers fistfighting for big-screen TVs -- stores aim to build on the momentum.  Companies like  have revamped their selection & staffed up in anticipation of a merrier Christmas.  The National Retail Federation projects that about 164M consumers, 69% of Americans, will shop at stores or online over the long weekend that started on Thanksgiving.  Though Black Friday still has strong symbolism within the industry, consumers have become less loyal to the event' promotions . Instead, they're spending more of their holiday budgets before or after Thanksgiving.  Overall holiday spending is expected to climb as much as 4% from last year, helped by low unemployment & rising home values.  The purchases will amount to roughly $680B in Nov & Dec, the  NRF estimates.  Market-analysis firm NPD Group sees positive momentum forming, with sales for a basket of merchandise up about 6% in the first 2 weeks of Nov from a year ago.  Movement has been particularly brisk for apparel, athletic footwear, beauty & small appliances.  Retailers have been offering deals online & in stores all week, aiming to get a jump on Black Friday & cut thru the noise.

Black Friday Retailers Looking to Extend Moment of Optimism

OPEC & Russia have crafted the outline of a deal to extend their oil production cuts to the end of next year, although both sides are still hammering out crucial details, according to leakers.  OPEC  several non-OPEC & nations led by Russia will meet next week to discuss prolonging their output curbs.  Moscow had been hesitating  over the need for an extension now because the current deal doesn't expire until the end of Mar.  After days of talks, Moscow & Riyadh now agree they should announce an additional period of cuts at the Nov 30 meeting.  Russia wants the extension deal to include new language that would link the size of the curbs to the health of the oil market.  “The goal to re-balance the market hasn’t been met in full yet, so everyone is in favor of extensions to reach final goals, Russia also supports these proposals,” Energy Minister Alexander Novak said.  “Different options are considered now, we will discuss details at the Nov. 30 meeting.”  Russian Pres Putin talked with Saudi King Salman bin Abdulaziz, during which they “emphasized importance of further coordination between Russia & Saudi Arabia in the global hydrocarbon markets.”  The deal isn't finalized as Russia & Saudi Arabia haven't yet agreed on the new language.  West Texas Intermediate crude extended gains to the highest level since Jul 2015.  Futures for January delivery rose 1.6% to $58.92 a barrel.

Russia-OPEC Agree on Framework to Extend Oil Cuts

Stocks are extending their winning ways on optimism about the holiday shopping season.  Next week those guys ni DC return & they have plenty of serous business to finish before year-end.  Traders will return in full force to see if they can take the Dow to 24K.  They will need cooperation from those guys in DC to make it happen.

Dow Jones Industrials


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