Market Update & Important Indicators
U.S. stocks rose to fresh highs Monday after Senate leaders said they reached a deal to end the federal government shutdown. The Dow Jones Industrial Average added 0.2%. The S&P 500 climbed 0.5% and the Nasdaq Composite rose 0.7%, with all three indexes heading toward record closes. Investors had largely shrugged off the shutdown, which began after the Senate rejected a one-month spending bill late Friday night and by Monday afternoon looked close to ending. U.S. government bonds inched lower, while the WSJ Dollar Index, which tracks the dollar against a basket of 16 other currencies, ticked down 0.1%. Economic growth around the world has been solid, helping stocks keep powering higher, even after Congress came to a standstill over legislation in Washington. Investors have also largely bet that the Federal Reserve will stick to a gradual course of interest-rate increases in 2018–something they say should help stocks trading near records continue their ascent. Broad gains across sectors helped offset a decline in shares of industrial and materials companies on Monday. Shares of energy companies in the S&P 500 rose 1.8%, following U.S. crude-oil prices higher. The U.S. gold price traded higher overnight, gaining 0.2% to finish at 1,333.10 US$/oz.
European stocks pushed higher Monday, with Spanish and Greek shares gaining in the wake of sovereign ratings upgrades and closing at a 5-month and almost three-year highs, respectively. The Stoxx Europe 600 index ended up 0.3% at 402.11, closing at its highest since August 2015. Last week, the pan-European gauge rose for a third consecutive week. Germany's DAX 30 index rose 0.2% to 13,463.69, leaving the gauge at its highest close since November. France's CAC 40 moved up 0.3% to 5,541.99. The U.K.'s FTSE 100 index fell 0.2% to 7,715.44.
Market reaction in Asia was muted Monday after the partial shutdown of the U.S. federal government. Japan's Nikkei Stock Average was flat while Hong Kong's Hang Seng Index edged up 0.4%. Shares of some Apple suppliers declined across the region, however, dragging down some tech-heavy indexes. South Korea's Kospi fell 0.7% amid a 2.2% drop in shares of index heavyweight Samsung Electronics. Shenzhen stocks rebounded around 1.2% after a period in which Chinese investors focused on large-capitalization names, many of which are listed in Shanghai.
Afternoon selling took Australian shares to a 5th straight loss and the benchmark to a 7-week low. Settling at the session low, the S&P/ASX 200 dropped 0.2% to 5991.9 as the major banks in particular weighed. Continuing their underperformance, Commonwealth Bank and Westpac each lost 1.2% while ANZ and NAB fell 0.9% and 0.6%, respectively. Real-estate-classifieds portal Domain slumped 17% to its lowest since November's listing on news its CEO has departed. Energy stocks also faltered after crude's fall Friday to a one-week low, with Woodside down 0.8% and Santos 0.4% lower.
The London Metal Exchange’s 3-month copper contract traded higher overnight, rebounding 0.4% to finish at $7,068/t. The other base metals finished mostly higher. Aluminium prices bounced 1.2% to 2,245/t, while lead prices jumped 1.4% to close at 2,619/t. Zinc prices were flat at 3,440/t, whilst nickel prices rose 0.4% to 12,724/t. Tin prices added anoter 0.8%, closing at 20,855/t.
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