Tuesday November 26th

26-11-2019

Stocks point to flat open after record-setting session

U.S. stock index futures were little changed on Tuesday as investors digested sharp gains from the previous session that pushed equities to fresh record highs. Around 7:10 a.m. ET, Dow Jones Industrial Average futures pointed to a loss of just 3 points at the open. S&P 500 and Nasdaq 100 futures also indicated a flat open. Tuesday’s muted moves come after the major averages all set record closing highs amid optimism around the U.S.-China trade talks. China’s ministry of commerce said Monday that the leaders of China and the U.S. spoke over the phone. “Both sides discussed resolving core issues of common concern, reached consensus on how to resolve related problems (and) agreed to stay in contact over remaining issues for a phase one agreement,” the Chinese-language statement said, according to a CNBC translation. It is yet unclear if both sides will be reaching a compromise before Dec. 15, when new U.S. tariffs on Chinese goods are set to kick in. “Both China and the US have a clear interest in getting a phase-one trade deal completed relatively soon to calm financial markets and reduce the drag on their economies from the uncertainty attributable to the trade war,” Ed Yardeni, president and chief investment strategist at Yardeni Research, wrote in a note. “If there is no deal, stock prices could crater. However, Trump views the [Dow] as his most important poll.” On the data front, advanced economic indicators for October, the October international trade deficit, and the Philadelphia Fed non-manufacturing index for November will be released at 8:30 a.m. ET. The S&P CoreLogic Case-Shiller U.S. National Home Price Index (HPI) for September, new home sales for October and consumer confidence figures for November will follow slightly later in the session. The latest monthly Richmond Fed survey and Dallas Fed services data will be published at around 10 a.m. ET. Stocks in Asia mostly rose on Tuesday following record finishes overnight on Wall Street. Hong Kong-listed shares of Chinese tech behemoth Alibaba also popped on their debut, becoming the world’s largest listing so far in 2019. Hong Kong-listed shares of shares of Alibaba surged about 6.6% on the day, ahead of the broader market as the Hang Seng index dipped 0.2% to close at 26,939.21. Mainland Chinese shares mostly saw gains on the day, with the Shenzhen component up 0.53% to 9,677.23 and the Shenzhen composite 0.324% higher at about 1,605.64. The Shanghai composite was largely unchanged at around 2,907.06. In Japan, the Nikkei 225 added 0.35% to close at 23,373.32 while the Topix index gained 0.16% to end its trading day at 1,705.71. South Korea’s Kospi shed earlier gains as it dipped 0.1% on the day to 2,121.35. Oil prices rose on Tuesday on hopes of progress towards a trade agreement between the United States and China, the world’s biggest oil users, and predictions of a draw on U.S. crude inventories. Brent crude, the international price benchmark, gained 12 cents to trade at $63.77, while West Texas Intermediate crude gained 13 cents, or 0.2%, to trade at $58.14 a barrel. Gold edged off an early two-week low on Tuesday as cautious traders awaited further developments in the trade negotiations between the United States and China, though a firm equities market kept a lid on bullion’s gains. Spot gold was up 0.2% at $1,457.58 per ounce, having earlier touched its lowest since Nov. 12 at $1,451.15. U.S. gold futures inched 0.1% higher to $1,457.50.