Friday December 27th

27-12-2019

Dow set to gain 100 points at the open, extending year-end rally

U.S. stock index futures pointed to a higher open on Friday as optimism continues to drive year-end rally. Futures on the Dow Jones Industrial Average were up 96 points, pointing to a higher start of about 105 points. Futures on Nasdaq and S&P 500 traded higher too. The major averages are set to hit new all-time highs. The tech-heavy Nasdaq topped the 9,000 mark for the first time Thursday, lifted by a jump in Amazon shares on a record holiday shopping season. The S&P 500, up already 29.2% in 2019, is inches away from reaching historic proportions. The benchmark will post its best year since 1997 if it ends this year up more than 29.6%. “News flow remains relatively quiet, but stocks are extending their melt-up price action into the final days of 2019,” Adam Crisafulli, founder of Vital Knowledge, said in a note on Friday. Investors are embracing riskier assets ever since the U.S. and China announced they have reached a phase one trade agreement earlier this month. The two sides are in the middle of translating and formalizing the deal. President Donald Trump said Tuesday there will ultimately be a signing ceremony with Chinese leader Xi Jinping, adding a quicker signing will happen soon. Data overnight showed a solid rebound for industrial profits in China, further boosting sentiment. Friday marks day three of the so-called Santa Claus rally period, which is historically beneficial for stocks. Since 1950, the S&P 500 has rallied an average of 1.3% during the final five trading days of the year and the first two sessions of the new year, according to the Stock Trader’s Almanac. No economic data and earnings are scheduled for Friday. Stocks in Asia were mixed on Friday, one day after shares on Wall Street jumped to new record highs overnight. Mainland Chinese stocks shed earlier gains to end lower on the day. The Shanghai composite fell fractionally lower to about 3,005.04, while the Shenzhen component declined 0.68% to 10,233.77. The Shenzhen composite declined 0.675% to around 1,697.91. Hong Kong’s Hang Seng index gained 1.18%, as of its final hour of trading. In South Korea, the Kospi rose 0.29% to close at 2,204.21. Japan’s Nikkei 225 closed 0.36% lower at 23,837.72. The Topix index added 0.11% to finish its trading day at 1,733.18. Oil prices rose on Friday, hitting three-month highs after data showed record online spending by U.S. consumers, stoking faith in the world’s no. 1 economy even before the hoped-for end to the trade war between Washington and Beijing. Brent crude futures were up 16 cents, or 0.2%, at $68.08 a barrel, after rising to as high as $68.10, the highest since September. The West Texas Intermediate contract was up 19 cents, or 0.3%, at $61.87 a barrel. Gold prices rose slightly to their highest in nearly two months on Friday, heading for their best week in more than four months, as the dollar eased and investors hedged against risks ahead of the year-end. Spot gold hit its highest since Nov. 4 at $1,513.88 per ounce and was up 0.1% at $1,512.81 per ounce by 0458 GMT. For the week, it has gained over 2% so far, its best since early August. U.S. gold futures were up 0.2% at $1,517.60 per ounce.