Updated: 11-28-2014

The Market at 09:14AM ET

Moving the Market

Crude oil falls below $70/bbl after OPEC leaves production quotas unchanged

NYSE to close early at 13:00 ET

Sector Watch
Strong:
Weak:

09:14AM ET
[BRIEFING.COM] S&P futures vs fair value: -1.90. Nasdaq futures vs fair value: +9.80. The stock market is on track to begin the abbreviated Friday session on a slightly lower note. The S&P 500 futures trade two points below fair value after slipping at the start of the European session.

Traditionally, Fridays after Thanksgiving feature breathless reports from nondescript malls in the Northeast, focusing on the crowd volumes in an attempt to craft a narrative about holiday spending trends. However, instead of focusing on Black Friday sales today, investors are more likely to respond to what happened to black gold while U.S. markets were closed on Thursday.

Yesterday, the Organization of the Petroleum Exporting Countries [OPEC] chose to leave its output quota unchanged at 30 million barrels per day. That news sent crude oil below the $70.00/bbl level in short order. Currently, the energy component is lower by 5.9% at $69.35/bbl with the weakness likely to weigh on the energy sector. To that point, Dow components Chevron (CVX 111.20, -3.91) and ExxonMobil (XOM 91.04, -3.44) are indicated to open lower by 3.4% and 3.6%, respectively.

Treasuries hold modest gains with the 10-yr yield lower by two basis points at 2.21%.

Investors did not receive any economic data today and the New York Stock Exchange will close at 13:00 ET.

08:56AM ET
[BRIEFING.COM] S&P futures vs fair value: -1.90. Nasdaq futures vs fair value: +9.90. The S&P 500 futures trade two points below fair value.

The major Asian indices ended mostly higher with China's Shanghai Composite (+2.0%) pacing the rally. According to the Wall Street Journal, China is preparing to launch a system for insuring bank deposits up to CNY500,000
  • In economic data: 
    • Japan's National CPI eased to 2.9% from 3.2% year-over-year (expected 3.0%) while National Core CPI also came in at 2.9%, as expected. Tokyo CPI increased 2.1% year-over-year (consensus 2.3%; prior 2.5%) while Tokyo Core CPI came in at 2.4% (expected 2.3%; last 2.5%). Also of note, Industrial Production ticked up 0.2% month-over-month (expected -0.4%; last 2.9%), Retail Sales rose 1.4% year-over-year (consensus 1.5%; last 2.3%), and Household Spending fell 4.0% year-over-year (expected -4.8%; previous -5.6%), and the Unemployment Rate eased to 3.5% from 3.6% (expected 3.6%) 
    • South Korea's Industrial Production fell 1.6% month-over-month (consensus 0.8%; last 0.0%) 
    • Australia's Private Sector Credit rose 0.6% month-over-month (expected 0.5%; previous 0.5%) 
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  • Japan's Nikkei rose 1.2% with exporters showing strength. Olympus, Konica Minolta, and Sony gained between 4.0% and 4.5%. 
  • Hong Kong's Hang Seng shed 0.1%. Energy names kept a lid on the index with CNOOC, PetroChina, and Kunlun Energy down between 3.1% and 5.5%. Bank of Communications outperformed, surging 6.5%. 
  • China's Shanghai Composite advanced 2.0% with help from financials. China Everbright Bank and China CITIC Bank Corp both surged the limit, 10.0% 
Major European indices trade lower with Italy's MIB (-0.6%) leading the decline. Italian debt has been in demand following a spike in the Unemployment Rate. The country's benchmark yield is lower by three basis points at 2.04% while Spain's 10-yr is holding its ground at 1.90%.
  • Economic data was plentiful: 
    • Eurozone CPI rose 0.3% year-over-year while Core CPI climbed 0.7%. Both figures matched expectations. The Unemployment Rate held at 11.5%, as expected 
    • Germany's Retail Sales rose 1.9% month-over-month (expected 1.7%; last -2.8%) 
    • Great Britain's Nationwide HPI rose 8.5% year-over-year (expected 8.6%; previous 9.0%) 
    • French Consumer Spending fell 0.9% month-over-month (expected 0.2%; prior -0.5%) while PPI slipped 0.2% month-over-month (consensus 0.0%; last 0.5%) 
    • Italy's CPI ticked down 0.2% month-over-month (expected -0.3%; last 0.1%) while the year-over-year reading inched up 0.2% (consensus 0.0%; previous 0.1%). Separately, PPI slipped 0.4% month-over-month (prior 0.0%) and the monthly Unemployment Rate rose to 13.2% from 12.9% (consensus 12.6%) 
    • Spain's Retail Sales rose 1.0% year-over-year (expected 2.0%; prior 0.8%) and the Current Account surplus narrowed to EUR440 million from EUR1.29 billion 
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  • Great Britain's FTSE is lower by 0.2% with energy names facing broad pressure. BG Group, Tullow Oil, and BP are down between 2.5% and 7.4%. Consumer names outperform with Kingfisher and Marks & Spencer group up 2.8% and 1.3%, respectively 
  • In France, the CAC has given up 0.3%. Energy names also lag with Total and Technip both down near 3.0% while Gemalto leads with a gain of 1.0% 
  • Germany's DAX trades down 0.2%. Conglomerates BASF and Siemens weigh with respective losses of 1.9% and 1.6% while Deutsche Lufthansa outperforms. The airline has jumped 3.4% 
  • Italy's MIB underperforms with a loss of 0.6%. Saipem is the weakest performer, down 4.9% while many financials also trade in the red. BMPS, Mediobanca, UBI Banca, and Unicredit are down between 0.7% and 1.2%

08:29AM ET
[BRIEFING.COM] S&P futures vs fair value: -2.90. Nasdaq futures vs fair value: +9.40. U.S. equity futures continue facing modest pressure with the S&P 500 futures three points below fair value. The few participants who are getting ready for today's session have not received any economic data or earnings of note. With that in mind, the energy sector is likely to be today's focal point after OPEC's decision to leave production quotas unchanged.

That news has weighed on crude oil, which has been trying to pare its losses. The energy component has been able to add about 50 cents from yesterday's low, but remains down 5.9% at $69.31/bbl. This has led to early weakness in major energy names like Chevron (CVX 111.60, -3.51), EOG Resources (EOG 89.00, -5.07), ExxonMobil (XOM 91.17, -3.31), and Halliburton (HAL 44.97, -2.37).

07:56AM ET
[BRIEFING.COM] S&P futures vs fair value: -1.60. Nasdaq futures vs fair value: +9.70. U.S. equity futures trade modestly lower amid cautious action overseas. The S&P 500 futures hover two points below fair value with the bulk of the weakness occurring after markets in Europe opened for action. European indices enjoyed an upbeat session yesterday, but they are giving back those gains today.

Crude oil has been under pressure since yesterday after an OPEC meeting resulted in no changes to production quotas. The energy component is currently lower by 6.4% at $69.01/bbl.

Treasuries hold gains with the 10-yr yield down two basis points at 2.21%.

There is no economic data on today's schedule and the stock market will close at 13:00 ET.

In U.S. corporate news of note:
  • Airline names have shown pre-market strength following the drop in fuel prices. Delta Air Lines (DAL 46.51, +2.27) and United Continental (UAL 59.60, +3.00) are both up near 5.0% in pre-market action 
  • Conversely, major energy companies have been pressured by the weakness in crude. BP (BP 39.25, -2.34), Chevron (CVX 110.50, -4.61), and ExxonMobil (XOM 90.95, -3.53) are down between 3.7% and 5.6% 
Reviewing overnight developments:
  • Asian markets ended mostly higher. Japan's Nikkei +1.2%, China's Shanghai Composite +2.0%, and Hong Kong's Hang Seng -0.1% 
    • In economic data: 
      • Japan's National CPI eased to 2.9% from 3.2% year-over-year (expected 3.0%) while National Core CPI also came in at 2.9%, as expected. Tokyo CPI increased 2.1% year-over-year (consensus 2.3%; prior 2.5%) while Tokyo Core CPI came in at 2.4% (expected 2.3%; last 2.5%). Also of note, Industrial Production ticked up 0.2% month-over-month (expected -0.4%; last 2.9%), Retail Sales rose 1.4% year-over-year (consensus 1.5%; last 2.3%), and Household Spending fell 4.0% year-over-year (expected -4.8%; previous -5.6%), and the Unemployment Rate eased to 3.5% from 3.6% (expected 3.6%) 
      • South Korea's Industrial Production fell 1.6% month-over-month (consensus 0.8%; last 0.0%) 
      • Australia's Private Sector Credit rose 0.6% month-over-month (expected 0.5%; previous 0.5%) 
    • In news: 
      • According to the Wall Street Journal, China is preparing to launch a system for insuring bank deposits up to CNY500,000
  • Major European indices trade mostly lower. Great Britain's FTSE -0.4%, France's CAC -0.3%, and Germany's DAX -0.3%. Elsewhere, Italy's MIB -0.5% and Spain's IBEX +0.1%
    • Economic data was plentiful: 
      • Eurozone CPI rose 0.3% year-over-year while Core CPI climbed 0.7%. Both figures matched expectations. The Unemployment Rate held at 11.5%, as expected 
      • Germany's Retail Sales rose 1.9% month-over-month (expected 1.7%; last -2.8%) 
      • Great Britain's Nationwide HPI rose 8.5% year-over-year (expected 8.6%; previous 9.0%) 
      • French Consumer Spending fell 0.9% month-over-month (expected 0.2%; prior -0.5%) while PPI slipped 0.2% month-over-month (consensus 0.0%; last 0.5%) 
      • Italy's CPI ticked down 0.2% month-over-month (expected -0.3%; last 0.1%) while the year-over-year reading inched up 0.2% (consensus 0.0%; previous 0.1%). Separately, PPI slipped 0.4% month-over-month (prior 0.0%) and the monthly Unemployment Rate rose to 13.2% from 12.9% (consensus 12.6%) 
      • Spain's Retail Sales rose 1.0% year-over-year (expected 2.0%; prior 0.8%) and the Current Account surplus narrowed to EUR440 million from EUR1.29 billion 
    • Among news of note: 
      • Italian debt has been in demand following the spike in the Unemployment Rate. The country's benchmark yield is lower by two basis points at 2.05% while Spain's 10-yr holds flat at 1.90%

06:47AM ET
[BRIEFING.COM] S&P futures vs fair value: -4.00. Nasdaq futures vs fair value: +7.00.

06:47AM ET
[BRIEFING.COM] Nikkei...17,459.85...+211.40...+1.20%.  Hang Seng...23,987.45...-16.80...-0.10%.

06:47AM ET
[BRIEFING.COM] FTSE...6,675.60...-47.70...-0.70%.  DAX...9,937.14...-37.30...-0.40%.

04:10PM ET
[BRIEFING.COM] The major averages ended the session near their best levels of the day with the Nasdaq Composite (+0.6%) finishing in the lead. The S&P 500 rose 0.3% to another record high while the Dow Jones Industrial Average (+0.1%) hovered near its flat line throughout the session.

Meanwhile, the benchmark index spent the day in a slow and steady advance despite a heavy batch of disappointing economic data that was reported this morning. The index did show some signs of defensive posturing as all four countercyclical sectors ended ahead of the market while cyclical sectors traded in mixed fashion.

The telecom services sector (+1.2%) finished in the lead after trending higher throughout the day, but more notably, the heavily-weighted health care sector (+0.7%) posted a solid gain with help from biotechnology. The iShares Nasdaq Biotechnology ETF (IBB 303.87, +4.20) settled higher by 1.4% to extend this week's gain to 3.0%. Conversely, biotechnology helped the Nasdaq spend the day in the lead.

Although biotech provided a measure of support, the Nasdaq also drew significant strength from chipmakers after Analog Devices (ADI 54.56, +2.85) reported better than expected results. The stock spiked 5.5% while the PHLX Semiconductor Index jumped 2.1% with all but one component ending in the green.

The solid gains among chipmakers helped the technology sector (+0.9%) spend the day in a steady uptrend. However, the same could not be said for the remaining cyclical groups. Financials (+0.2%) held a slim gain throughout the day while consumer discretionary (unch), energy (-1.1%), industrials (-0.2%), and materials (+0.1%) lagged.

Notably, the energy sector widened its November loss to 2.8% as crude oil took another leg down, falling 0.5% to $73.75/bbl.

Treasuries spiked following today's data, but slipped into the close. The 10-yr yield ended lower by a basis point at 2.24%.

Intraday participation was well below average, but volume spiked into the close. As a result, just under 685 million shares changed hands at the NYSE floor.

Economic data was plentiful and almost entirely disappointing. Initial claims, durable orders ex-transportation, personal income/spending, Chicago PMI, Michigan Sentiment, and October pending/new home sales all missed expectations while headline durable orders beat:
  • Initial claims came in at 313,000 (Briefing.com consensus 288,000), which was above the revised prior week count of 292,000 (from 291,000) 
    • Continuing claims fell to 2.316 million from 2.330 million 
  • Durable goods orders increased 0.4% in October following an upwardly revised 0.9% (from -1.3%) decline (Briefing.com consensus -0.6%) 
    • A 45.3% increase in defense aircraft orders helped boost total aircraft demand by 8.7%. The gains in aircraft orders drove overall transportation orders up 3.4% after declining 3.3% in September 
    • Excluding transportation, orders fell 0.9% in October after increasing an upwardly revised 0.2% (from -0.2%) (consensus +0.5%) 
  • Personal income increased 0.2% for a second consecutive month in October (Briefing.com consensus +0.4%) 
    • Personal spending increased 0.2% in October after an upward revision resulted in no change (from -0.2%) in September (consensus +0.3%) 
  • The Chicago PMI for October fell to 60.8 from 66.2 (consensus 63.0) 
  • The University of Michigan Consumer Sentiment report for November was revised down to 88.8 from 89.4 (consensus 90.0) 
  • Pending home sales for October fell 1.1% (expected +0.5%) 
  • New home sales increased 0.7% in October to 458,000 from a downwardly revised 455,000 (from 467,000) (consensus 470,000) 
  • The weekly MBA Mortgage Index fell 4.3% to follow last week's 4.9% increase 
Equity markets will be closed tomorrow and Friday's session will end early at 13:00 ET.

Happy Thanksgiving!
  • Nasdaq Composite +14.6% YTD 
  • S&P 500 +12.1% YTD 
  • Dow Jones Industrial Average +7.6% YTD 
  • Russell 2000 +2.3% YTD
Dow: +12.81… | Nasdaq: +29.07… | S&P: +5.80…
NASDAQ Adv/Dec 1683/1060. …NYSE Adv/Dec 1913/1166.

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