Stocks Moving Modestly Higher In Early Trading
Stocks have moved modestly higher in early trading on Tuesday, adding
to the strong gains posted in the previous session. The major averages
have all moved to the upside, although buying interest remains
relatively subdued.
The major averages are currently holding on to modest gains, not far off their highs for the young session. The Dow is up 17.90 points or 0.1 percent at 13,253.29, the Nasdaq is up 13.28 points or 0.4 percent at 3,023.88 and the S&P 500 is up 3.13 points or 0.2 percent at 1,433.49.
The early strength on Wall Street is
partly due to optimism about reports indicating that President Barack
Obama and House Speaker John Boehner, R-Ohio, are making progress on an
agreement to avoid the looming fiscal cliff.
Reports have
suggested that a proposal from Obama has increased the amount of income
that would be subject to higher tax rates and offered $1.2 trillion in
spending cuts.
Peter Boockvar, managing director at Miller Tabak,
said, "The prospect for a D.C. fiscal deal seems to be growing and it's
what markets continue to cheer.
"Details of the deal and the extent of its contractionary impact will be dealt with in 2013 it seems," Boockvar added.
Continued
uncertainty about the potential agreement has helped to limit the
upside for the markets, however, with some traders waiting for more
details before making any significant moves.
Networking
stocks are seeing considerable strength in early trading, with the NYSE
Arca Networking Index rising by 1.4 percent. With the gain, the index
has reached a three-month intraday high.
Computer hardware,
housing, and steel stocks are also seeing early strength, while most of
the major sectors have shown more modest moves.
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Tuesday. Japan's Nikkei 225 Index advanced by 1 percent, while Australia's All Ordinaries Index rose by 0.5 percent.
The major European markets have also moved to the upside on the day. While the French CAC 40 Index has edged up by 0.1 percent, the U.K.'s FTSE 100 Index and the German DAX Index are up by 0.4 percent and 0.5 percent, respectively.
In
the bond market, treasuries are seeing some further downside after
coming under pressure in the previous session. Subsequently, the yield
on the benchmark ten-year note, which moves opposite of its price, is up
by 2.3 basis points at 1.786 percent.
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US Budget Talk Hopes Lift TSX Tuesday Morning - Canadian Commentary
Canadian stocks were hovering in the green Tuesday morning as risk
appetite improved on optimism about a deal to avoid the "fiscal cliff."
President Barack Obama is reported to have softened his position. He is
said to have reduced his demand for new tax revenue by $200 billion and
has also offered to raise taxes beginning from incomes of $400,000 and
not $250,000.
US lawmakers are negotiating to avoid more than
$600 billion in automatic spending cuts and tax increases set to begin
in the new year
The S&P/TSX Composite Index gained 50.74 points or 0.41 percent to 12,332.09.
The price of Crude oil was
moving higher Tuesday on optimism about a deal to avoid the "fiscal
cliff." Today after the market hours, the API will release its US Crude oil inventories report for the weekended December 14. Crude for January added $0.18 to $87.38 barrel.
In
the oil patch, Athabasca Oil Corp. (ATH.TO0 rose nearly 4 percent after
announcing 2013 capital budget and production guidance. The company
plans to invest $798 million to develop its Light Oil and Thermal Oil
assets in Alberta and reaffirmed that it is on track to exit 2012 with
10,000 to 11,000 barrels of oil equivalent per day from its assets in
the liquids-rich Deep Basin.
Canadian Natural Resources and Baytex Energy Corp. moved up close to 2 percent each.
Pharmaceuticals
company Paladin Labs Inc. (PLB.TO) gained nearly 2 percent after it
said it has received approval from Health Canada of Paladin's New Drug
Submission or NDS for Silenor (doxepin) for the treatment and
symptomatic relief of insomnia characterized by frequent nocturnal
awakening and/or early morning awakenings.
Meanwhile, gold stocks were trading lower amid weak bullion prices. gold for February eased $5.00 to $1,693.20 an ounce
Among gold plays, Seabridge gold was down about 3 percent. Goldcorp. , Agnico-Eagle Mines and Barrick gold lost around 1 percent each.
In
economic news from the U.S., the Commerce Department said the current
account deficit fell to $107.5 billion in the third quarter, down 9
percent from the second quarter imbalance of $118.1 billion. It was the
lowest trade gap since the final three months of 2010.
Meanwhile, a
report released by the National Association of Home Builders showed
that the NAHB/Wells Fargo Housing Market Index climbed to 47 in December
from a revised 45 in November. Economists had expected the index to
edge up to 47 from the 46 originally reported for the previous month
In economic news from the euro zone,
U.K. annual inflation remained unchanged at 2.7 percent in November,
the Office for National Statistics said. The rate came in line with
economists' expectations. Month-on-month, consumer prices increased at a
slower pace of 0.2 percent, following a 0.5 percent rise in October. |
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European Markets Rise On Fiscal Cliff Hopes
The European markets are trading higher on Tuesday, amid hopes of an
agreement on the fiscal cliff in the U.S. The Asian markets closed
mostly higher, taking cues from the previous session on Wall Street.
Reports
suggested that U.S. House Speaker John Boehner is now open to a tax
increase on the country's highest earners. This had been a key provision
called for by President Barack Obama, as he negotiates with lawmakers
over a budget fix that would avoid the fiscal cliff set to take effect
early next year.
Obama also is reported to have softened his
position. He is said to have reduced his demand for new tax revenue by
$200 billion and has also offered to raise taxes beginning from incomes
of $400,000 and not $250,000.
U.K. annual inflation remained
unchanged at 2.7 percent in November, in line with economists'
expectations, the Office for National Statistics said. Month-on-month,
consumer prices increased at a slower pace of 0.2 percent, following a
0.5 percent rise in October.
European Central Bank President Mario
Draghi said Monday that the recent announcement by the European Union
leaders to establish a single supervisory mechanism for banks would help
restore investor confidence and would also contribute to reviving
inter-bank lending.
The euro Stoxx 50 index of eurozone bluechip stocks is gaining 0.38 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, is rising 0.30 percent.
The German DAX is gaining 0.5 percent. The UK's FTSE 100 and Switzerland's SMI are rising 0.4 percent each. The French CAC 40 has given up some of the early gains and is rising marginally.
In Frankfurt, Commerzbank is advancing 2 percent. Deutsche Bank is gaining 1.7 percent.
Infineon Technologies, ThyssenKrupp, RWE and Basf are notably higher.
Air
Berlin is gaining 5.7 percent. Germany's second-largest airline
announced an agreement between Air Berlin PLC & Co. Luftverkehrs KG
and Etihad Airport Services L.L.C. to carve-out Air Berlin's frequent
flyer program, 'topbonus'. The Berlin-based carrier also announced the
acquisition of a majority stake by Etihad Airport Services.
Bilfinger Berger is falling 1.9 percent. HSBC cut the stock to ''Underweight'' from ''Neutral.''
In Paris, telecom equipment firm Alcatel Lucent is gaining 2.5 percent and metal fabrication company Vallourec is advancing 1.4 percent.
EADS, Technip and Veolia are among notable gainers.
Credit Agricole is advancing 1.5 percent. BNP Paribas and Societe Generale are gaining moderately.
Renault is losing around 2 percent. The stock was downgraded at Bernstein.
In London, G4S is rising 3 percent. Miners Vedanta Resources, Rio Tinto and Eurasian Natural Resources are gaining between 2.6 percent and 1.9 percent.
Barclays, Lloyds Banking and Royal Bank of Scotland are notably higher.
Rolls-Royce is gaining 1.2 percent after announcing $1 billion worth contract from Japan's Skymark Airlines.
Software
developer Delcam now expects profit before tax for full-year 2012 to be
ahead of current market expectations. The stock is gaining 6 percent.
Park Group is gaining nearly 5 percent after first-half loss narrowed.
Petrofac said it expects full year net profit to increase at least 15 percent from last year. The stock is down 0.4 percent.
Armour Group is declining 5.8 percent. The company reported a wider loss for the full year.
Merrill Lynch cut Heineken to ''Neutral'' from ''Buy.'' The stock is losing 2.3 percent.
Across Asia/Pacific, Australia's All Ordinaries advanced 0.5 percent, Japan's Nikkei 225 gained around 1 percent and China's Shanghai Composite Index rose 0.1 percent. However, Hong Kong's Hang Seng slid about 0.01 percent.
In
the U.S., futures point to a higher open on Wall Street. In the
previous session, the major averages finished notably higher, amid
increased optimism that a solution can be found for the so-called fiscal
cliff. The Dow gained 0.8 percent, the Nasdaq climbed 1.3 percent and the S&P 500 rose 1.2 percent.
In the commodity space, Crude for January delivery is adding $0.51 to $87.71 per barrel and February gold is rising $2.6 to $1700.8 a troy ounce. |
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Asian Markets Trade Higher
Asian stock markets are mostly trading in positive territory on Tuesday with investors tracking a positive lead from Wall Street where stocks closed higher overnight amid renewed optimism the U.S. government will fix the fiscal cliff.
The
Australian market is trading notably higher with investors picking up
key stocks from financial, mining, consumer staples and industrial
sections.
The benchmark S&P/ASX 200 index is trading at 4,604.4, up 31 points or 0.7 percent from its previous close. The broader All Ordinaries index is up 33 points or 0.7 percent at 4,621.
Among bank stocks, ANZ Bank, Commonwealth Bank of Australia and National Australia Bank are up 0.5 to 0.7 percent, and Westpac is trading higher by 1.3 percent. Bendigo & Adelaide Bank is adding about 1.5 percent, while Bank of Queensland is up marginally.
Among top miners, BHP Billiton (BHP, BBL) and Newcrest Mining are up with modest gains, while Rio Tinto (RIO) and Fortescue Metals are up 1.6 percent and 1.3 percent, respectively.
In the energy sector, Woodside Petroleum, Oil Search, Origin Energy and Caltex Australia are trading flat, while Santos is up by around 0.6 percent.
Shares of Paladin Energy are up more than 13 percent and is the top gainer in the S&P/ASX 200 index. Lynas Corp. shares are up 6.5 percent, while Atlas Iron is trading higher by 5.5 percent.
Iluka
Resources, ASL, Qantas Airways, Sims Metal Management, Downer EDI, News
Corporation, Tabcorp Holdings and Tatts Group are up 2 to 4 percent. SP
Ausnet, Leighton Holdings, Lend Lease Group and Spark Infrastructure
are also up with strong gains.
Fairfax Media, Incitec Pivot and Aurora Oil & Gas are trading notably lower.
In
economic news, the Conference Board's Leading Index for Australia
increased 0.2 percent in October, marking the first increase after three
consecutive months of decline. The Board said rural goods exports,
building approvals and stock prices led the gains. The Coincident Index
increased 0.1 percent.
According to the minutes of Reserve Bank of
Australia's December 4 meeting, members of the monetary policy board
said that while global economic news over the past month had become more
positive, further easing was appropriate.
China's growth had
stabilized, the minutes said, while the U.S. economy continued to grow
at a moderate pace - although the fiscal cliff remains a concern, as do
the challenges presented by Europe.
"At this meeting, the
information on labor costs and softening labor market conditions
suggested that the inflation outlook still afforded the Board some scope
to provide additional support to demand," the minutes said. At the
meeting, the RBA lowered its benchmark cash rate by 25 basis points,
from 3.25 percent to 3 percent.
The Board judged that a further
easing in the stance of monetary policy was appropriate now while the
full effects of earlier measures are yet to be observed.
The
Japanese market opened on a firm note amid hopes the central bank will
come out with more stimulus following the Liberal Democratic Party
returning to power.
The benchmark Nikkei 225 Index was up 108.6 points or 1.1 percent at 9,937.4 when the morning session ended.
Real
estate, banking, oil, pulp & paper, non-ferrous metals, steel and
rubber stocks were mostly up in positive territory with solid gains.
Electric power, retail and precision instruments stocks were mixed.
Tokyo Electric Power jumped by over 13 percent on hopes the nuclear reactors will commence operations soon. Sharp Corp. gained 8 percent and Ricoh moved up by about 7.5 percent.
Nomura Holdings, Tokyu Land Corp., Tokyo Tatemono, Taisei Corp., Resona Holdings, Daiwa Securities Group, Hitachi Construction Machinery, Mitsui Chemicals, Shimizu Corp., Olympus Corp., Taiheiyo Cement and Mitsubishi UFJ Financial Group gained 4 to 6 percent.
Shares of Softbank Corp. gained nearly 5 percent following the company securing a bridge loan to fund its acquisition of Sprint Nextel Corp.
Mitsui
Engineering & Shipbuilding, Kobe Steel, Mizuho Financial Group,
Sumitomo Mitsui Financial Group, Daiwa House Industry, Pioneer Corp., JX
Holdings and Nisshin Steel also rose sharply.
Meanwhile, Kansai Electric Power, Taiyo Yuden, Chubu Electric Power, Japan Tobacco, Trend Micro, Osaka Gas and Mitsumi Electric lost 1 to 5 percent.
In the currency market, the U.S. dollar traded in the upper 83 yen level in early deals in Tokyo. The yen is currently trading at 83.96 to the dollar.
Among
other markets in the Asia-Pacific region, Hong Kong, Malaysia, New
Zealand and South Korea are trading modestly higher, while Shanghai,
Indonesia and Taiwan are trading weak.
On Wall Street, stocks
ended higher on Monday, boosted by increased optimism that a solution
can be found for the fiscal cliff. The major averages finished notably
higher, bouncing back from weakness seen late last week.
The Dow gained 100.4 points, or 0.8 percent, to close at 13,235.4, The Nasdaq climbed above the 3,000 mark, advancing 39.3 points, or 1.3 percent, to end at 3,010.6 and the S&P 500 rose 16.8 points, or 1.2 percent, to close at 1,430.4.
Major European markets ended on a mixed note Monday. The German DAX index gained 0.1 percent, while the French CAC 40 Index and the U.K.'s FTSE 100 index ended lower by 0.1 percent and 0.3 percent, respectively.
U.S. Crude oil settled
higher on Monday, mostly on hopes of a resolution to the U.S. budget
talks that will avert a fiscal cliff. Supply concerns arising from the
grim situation in the Middle East too contributed to oil's upmove. Crude for January delivery ended up $0.47 or 0.5 percent at $87.20 a barrel on the New York Mercantile Exchange. |
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Crude Edges Up Near $88
The price of Crude oil was moving higher Tuesday as risk appetite improved on optimism about a deal to avoid the "fiscal cliff."
Light Sweet Crude oil
futures for January delivery, added $0.51 to $87.71 a barrel.
Yesterday, oil settled marginally higher mostly on hopes of a resolution
to the U.S. budget talks that will avert a fiscal cliff nearing
deadline, with reports of a new plan put forward by John Boehner after
his talks with President Barack Obama last week. There were also supply
concerns arising from the grim situation in the Middle East, even as
investors largely ignored some downbeat manufacturing activity data out
of the U.S.
This morning, the U.S. dollar was lingering around a 7-month low versus the euro and a 2-month low against sterling. The buck was hovering near its 9-month high versus the yen and ticking lower against the Swiss franc.
In economic news from the euro zone,
U.K. annual inflation remained unchanged at 2.7 percent in November,
the Office for National Statistics said. The rate came in line with
economists' expectations. Month-on-month, consumer prices increased at a
slower pace of 0.2 percent, following a 0.5 percent rise in October.
From the U.S., the Commerce Department is due to release the current account balance for the third quarter at 8:30 am ET.
Later
during the session, the National Association of Home Builders is
scheduled to release the results of its housing market index for
December. Economists expect the index to rise by 1 point to 47.
Today after the market hours, the API will release its US Crude oil inventories report for the weekended December 14. |
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