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U.S. stocks rose Friday to fresh record highs, capping off a strong week for equities on the heels of strong economic data and corporate earnings results.
4:05 p.m. ET: Stocks post record closing highs
Each of the three major indices ended Friday’s session at record closes, solidifying a strong week of gains.
The S&P 500 was up nearly 2% for the week. The Dow rose 1.8%, and the Nasdaq climbed 2.3% on a weekly basis.
Here’s where the markets settled at the end of regular equity trading:
S&P 500 (^GSPC): +0.39% or +12.81 points to 3,329.62
Dow (^DJI): +0.17% or +50.46 points to 29,348.1
Nasdaq (^IXIC): +0.34% or +31.81 points to 9,388.94
Crude oil (CL=F): +0.27% or +$0.16 to $58.68 a barrel
Gold (GC=F): +0.44% or +$6.80 to $1,557.30 per ounce
3:30 p.m. ET: Wall Street going long emerging markets?
In the last few days, both BlackRock and UBS have issued calls suggesting emerging markets are a good bet after the U.S.-China deal’s signing. On Friday, the Swiss banking giant cited accommodative monetary policy in both countries as supportive of risk assets.
Reiterating a call it made late last year, UBS said:
We are overweight EM equities and within Asia we prefer Chinese equities, which are likely to be supported by the reduction in tariff uncertainty and corporate earnings growth of around 10%, driven by consumer-linked sectors.
Separately, BlackRock said that its multi-asset fund had ramped up on Emerging market equities (via call options) and agency mortgages — but scaled back on high-yield bonds.
1:55 p.m. ET: Boeing dips on report of new 737MAX technical glitch
Embattled Boeing can’t seem to catch a break with the 737MAX, which it’s struggling to get back in the air after grounding the plane last year. Amid a report that a new technical problem surfaced in testing, the company released a statement saying it was addressing the issue, without elaborating.
The new woes would appear to elongate the timeline under which 737 MAX can resume normal operations. Boeing’s stock is off around 2% on the day at $324.68.
1:30 p.m. ET: Disney drops ‘Fox’ from 20th Century
After the completion of its acquisition by Disney (DIS), 20th Century is rebranding. The New York Times is reporting that the Hollywood powerhouse is dropping ‘Fox’ from its name, so as not to be confused with its previous owner, the sprawling news empire (FOX) owned by Rupert Murdoch— and all the baggage that might entail.
According to The Times:
On Friday, the employees at the main movie studio arrived to a new email format (@20thcenturystudios) without the Fox. A Disney spokesman confirmed that both labels would drop Fox from their logos. Disney had no further comment.
“Downhill,” which arrives in theaters on Feb. 14 will be the first movie to bear the Searchlight Pictures name. “The Call of the Wild,” set for release on Feb. 21, will carry the 20th Century logo. The trumpet fanfare, klieg lights and familiar monolith logo will remain.
1:20 p.m. ET: JNJ holds gains after Risperdal judgment slashed
According to published reports, drug giant Johnson & Johnson (JNJ) saw a Philadelphia judge slash damages in a Risperdal case, from $8 billion to $6.8 million, in a case in which a Maryland man claimed the drug caused him to grow breasts.
In Friday midday trading, JNJ held within view of a record high it hit on Thursday, trading above $149.
12:40 p.m. ET: IMF on U.S.-China deal: ‘Trade truce not trade peace’
In a speech on Friday, the International Monetary Fund’s chief Kristalina Georgieva cautioned people against getting too excited about the ‘Phase One’ trade deal, echoing the sentiments of a few people that warn the world’s two largest economies have a long road to putting a host of nettlesome issues behind them.
"Trade truce is not the same as trade peace," she said, adding that "much more work is ahead to heal the fractures between the world’s two largest economies."
11:44 a.m. ET: Walmart reportedly shakes up executive team after holidays
Chief merchant Steve Bratspies is poised to depart, both outlets reported Friday, citing an internal memo sent to staff. Bratspie will reportedly be replaced by Scott McCall, who leads Walmart’s entertainment and toys business.
Walmart is also tapping Dacona Smith to become chief operating officer, the memo reportedly said. Smith previously served in this role at Walmart’s Sam’s Club unit.
Shares of Walmart were off 0.73% to $115.05 each.
10:15 a.m. ET: Google’s stock keeps climbing, sets new record
Alphabet-owned tech giant Google (GOOG) continued its push into the $1 trillion club of most valuable U.S. companies, with the stock setting a new record high at $1468.99 shortly after Friday’s opening bell. The backdrop to all of this is a tech sector that shows little signs of having its dominance eroded by widespread privacy concerns and regulatory probes.
It’s also a vote of confidence in CEO Sundar Pichai, who took the reins of Alphabet after founders Larry Page and Sergey Brin relinquished control of the tech giant last month.
10:00 a.m. ET: Consumer sentiment ticked down slightly in January, University of Michigan survey says
Consumer sentiment unexpectedly edged down to a reading of 99.1 in January, according to the University of Michigan’s preliminary monthly print for its survey of consumers.
Consensus economists had expected the headline print to hold at 99.3 for the month, matching December’s reading, according to Bloomberg data. The reading, however, still held relatively close to 2019’s recent high of 100.0 from May.
A subindex capturing surveyed individuals’ future expectations also fell, touching 88.3 for January from 88.9 in December.
However, the survey’s measure of consumers’ assessments about current conditions unexpectedly rose in January, coming in at 115.8 from 115.5 in December. Consensus economists expected this to decrease to 115.3.
9:35 a.m. ET: S&P 500, Dow, Nasdaq hit fresh record highs
The three major indices each hit fresh record highs around market open, buoyed by strong data on the housing market and corporate earnings results.
Here were the main moves in markets, as of 9:35 a.m. ET:
S&P 500 (^GSPC): +0.16% or +5.47 points to 3,322.28
Dow (^DJI): +0.12% or +34.57 points to 29,332.21
Nasdaq (^IXIC): +0.23% or +21.97 points to 9,379.16
Crude oil (CL=F): +0.31% or +$0.18 to $58.70 a barrel
Gold (GC=F): +0.43% or +$6.60 to $1,557.10 per ounce
9:10 a.m. ET: Housing starts data ‘spectacular but clearly unsustainable,’ economist says
December’s incredible jump in new-home building will be hard to replicate, at least one analyst said after the data release.
“In one line: Spectacular but clearly unsustainable,” Ian Shepherdson, chief economist for Pantheon Macroeconomics, said of the December housing starts data release.
“The much warmer-than-usual December weather likely boosted activity, but these are nonetheless very startling numbers, which will lift forecasts for Q4 residential investment,” he said. “But activity can’t be sustained at this level, and a hefty correction in January is a good bet. The permits numbers are a better guide to the underlying picture because they are much less weather-sensitive, and the December numbers are a bit disappointing.”
He noted, however, that the overall trend in the housing market is still pointing higher, especially in an environment of low rates and solid confidence among home-builders.
8:30 a.m. ET: Housing starts surged to a 13-year high in December
New-home building ended the year on strong footing, with housing starts in December jumping 16.9% month on month to a seasonally adjusted annual pace of 1.608 million. This was well above the consensus expectation for a rise of 1.1% to just 1.38 million starts for the month, according to Bloomberg data.
November’s housing starts were also upwardly revised to 1.375 million, from 1.365 million previously.
December’s gain was driven by a 29.8% leap in the more volatile multi-family building category, which includes apartments and condos. Those rose 29.8% for the month to the highest level since 1986. Single-family housing starts, which comprise the larger share of the housing market, rose 11.2% for the month.
Building permits, on the other hand, fell more than expected to a seasonally adjusted annual rate of 1.416 million. This marked a 3.9% decline from November, steeper than the 1.5% decline to 1.46 million expected. Building permits are seen as a proxy for future home-building. However,
7:50 a.m. ET: Schlumberger shares rise after earnings beat
Oilfield services provider Schlumberger (SLB) posted stronger than expected fourth-quarter results, with adjusted earnings per share (EPS) of 39 cents on revenue of $8.23 billion ahead of consensus estimates for adjusted EPS of 35 cents on revenue of $8.14 billion. Shares rose 2.6% in early trading.
However, the company’s North American revenues fell 13% over last year in the fourth quarter to $2.45 billion. Schlumberger signaled it would continue to pare back its North American business amid falling demand from shale producers.
As one of the world’s largest oilfield services provider, Schlumberger is often looked to as a bellwether for global energy markets. To that end, Schlumberger CEO Olivier Le Peuch provided mostly upbeat commentary around prospects for the oil market in 2020, according to a statement.
“From a macro perspective, we ended the year with 2020 oil demand growth sentiment turning positive as uncertainty reduced following the progress made toward a US-China trade deal. The fall in the North America production growth estimate of between 400,000 to 800,000 bpd should continue to support the thesis for international investment. The recent escalation of geopolitical risk should set the floor for the oil price going forward. In the near term, we expect the OPEC+ production cuts agreed upon in December 2019 to limit investment and activity, particularly in the Middle East and Russia, during the first half of 2020. As the year progresses, the effect of slowing North America production growth is likely to cause tightness in the market and further stimulate international operators to step up their investments in the second half of the year and beyond.”
7:32 a.m. ET: Stock futures rise after upbeat China data
Stock futures extended gains in early trading after more upbeat data from China signaled the world’s second largest economy was firming. The S&P 500 and Dow paced to open at record highs.
China’s gross domestic product rose 6% in the fourth quarter of 2019, matching the prior quarter’s pace and matching consensus expectations. This brought full-year 2019 GDP to expand at a pace of 6.1% – a near 30-year low but in-line with the government’s target for annual growth of between 6% to 6.5%.
In further signs of resurgence for the Chinese economy, fixed-asset investment and industrial output also rose strongly in December. And economists are largely banking on a newly signed U.S.-China phase one trade deal to further provide boosts to consumer confidence in the country.
Here were the main moves during the pre-market session, as of 7:32 a.m. ET:
S&P futures (ES=F): 3,323.25, up 6.75 points or 0.2%
Dow futures (YM=F): 29,308, up 68 points or 0.23%
Nasdaq futures (NQ=F): 9,165.25, up 31.75 points or 0.35%
Crude oil (CL=F): $58.74 per barrel, up $0.22 or 0.38%
Gold (GC=F): $1,558.30 per ounce, up $7.80 or 0.5%