US stocks ended week with strong gains

Indices notch their best week in nearly seven years

US stocks ended higher on Friday, with the S&P 500 index and the Nasdaq notching their best week in nearly seven years, after upbeat comments regarding that some sort of a trade deal is possible during a meeting between President Donald Trump and Chinese leader Xi Jinping at the G-20 summit in Argentina.

The Dow Jones Industrial Average rose 199.62 points, or 0.8%, to 25,538.46 after being down by as much as 72 points at the open. The S&P 500 index climbed 22.41 points, or 0.8%, to 2,760.17, while the Nasdaq Composite Index gained 57.45 points, or 0.8%, to 7,330.54.

 

Both the S&P 500 and the Nasdaq logged their best weekly performance since December 2011 while the blue-chip index posted its strongest week since November 2016.

Many investors are maintaining a fairly bearish outlook for the U.S. economy, overall, with expectations that a recession may take hold in 2019 or 2020, as the Federal Reserve aims to normalize interest rates.

Global investors will be following developments at the Group of 20 summit in Buenos Aires, which may determine the near-term outlook for trade relations between China and the U.S., with rising tensions between the world's largest economies serving as a key source of market anxiety.

Investors are hopeful that the U.S.-China trade negotiations will be resolved in a similar way as the U.S.-China-Mexico pact, which was agreed to only after the president issued a series of tough statements, and engaged in significant brinkmanship, before finally compromising on a deal at the 11th hour.

The development on the trade front comes on the heels of a week of speeches by Federal Reserve officials who appeared to have toned down their stance on the monetary policy. Investors had been fearful that the central bank will raise rates aggressively in 2019 after a widely expected 25 basis-point hike in December.

Economic data on Friday showed that The MNI Chicago business barometer jumped 8 points to 66.4 in November to a 4 year high, ending a streak of three straight declines. The survey is often seen as a bellwether for the broader U.S. economy.

On Friday, the ICE U.S. Dollar Index, was up 0.5% at 97.25 as gold futures settled. A stronger dollar typically weakens investment demand for dollar-priced commodities, like gold. The buck was up 0.3% this week and poised for a 0.1% gain in November.

Bullion prices ended lower at Comex on Friday, 30 November 2018. A decline in gold futures on Friday, on the back of further strength in the dollar, pushed the metal down for the week, but prices still tallied a second straight monthly gain.

Gold for February delivery shed $4.40, or 0.4%, to settle at $1,226 an ounce, with the contract registering a weekly fall of nearly 0.3%, based on last Friday's settlement. For the month, however, prices were up about 0.9% from the most-active December contract settlement. March silver lost 18.5 cents, or 1.3%, to $14.217 an ounce. The contract lost roughly 1% for the week and the month.

Oil prices on Friday, 30 November 2018 tallied a drop of about 22% in November, the biggest monthly percentage loss in a decade as traders fretted over a possible glut in global supplies. Prices, however, significantly pared much of their early Friday losses as speculation has grown over a potential production cut by major oil producers, ahead of next week's final meeting of the year for the Organization of the Petroleum Exporting Countries.Trading action was also held in check ahead of weekend meetings of the Group of 20 in Argentina, where oil talks are expected take place on the sidelines, ahead of an official meeting on Dec. 6 between OPEC and its allies.

On Friday, West Texas Intermediate crude for January delivery on the New York Mercantile Exchange fell 52 cents, or 1%, to settle at $50.93 a barrel after trading as low as $49.65. The January contract rose about 1% for the week. However, WTI prices plunged by roughly 22% in November, after trading at a four-year high as recently as early October.

Separately, the U.S. Treasury yield curve saw some flattening with the 2-yr yield adding one basis point to 2.81%, and the 10-yr yield losing three basis points to 3.01%.

Looking ahead, investors will receive the ISM Index for November and Construction Spending for October on Monday.

Powered by Capital Market - Live News