Global stock markets moved higher on Friday after Thursday's breakthrough in Washington talks to secure a bipartisan infrastructure deal, while oil prices headed toward a fifth consecutive weekly gain on hopes for demand growth. Investors have been looking to an infrastructure agreement to extend the U.S. recovery after massive fiscal stimulus helped the economy grow at a 6.4% annualized rate in the first quarter. The plan is valued at $1.2 trillion over eight years, of which $579 billion is new spending. The S&P 500 index hit a record high on Friday, boosted by gains in Nike and bank stocks. Oil prices were on track for a fifth consecutive weekly gain as growth in demand is expected to outstrip supply on bets that OPEC+ producers will be cautious in returning more output to the market. Inflation has been front-and-center of investors' minds, with the latest U.S personal consumption expenditures (PCE) data showing a measure of underlying inflation rose less than expected in May. Core PCE rose 3.4% year-over-year, above the Fed's 2% flexible target.
Dow Jones Industrial Average
The Dow Jones Industrial Average gained 0.69%. The biggest gainers of the session on the Dow Jones Industrial Average were Nike Inc., which rose 15.53% or 20.75 points to trade at 154.35 at the close. UnitedHealth Group Incorporated added 1.49% or 5.94 points to end at 404.81 and Procter & Gamble Company was up 1.43% or 1.90 points to 134.92 in late trade. The biggest losers included Caterpillar Inc., which lost 1.39% or 3.04 points to trade at 216.30 in late trade. Boeing Co declined 0.91% or 2.27 points to end at 248.30 and Microsoft Corporation shed 0.61% or 1.64 points to 265.05.
NASDAQ 100
The NASDAQ index declined 0.06%. The top performers on the NASDAQ Composite were Ikonics Corporation which rose 63.01% to 18.42, Fuwei Films Holdings Co Ltd which was up 38.27% to settle at 12.320 and Alfi Inc. which gained 32.14% to close at 16.980. The worst performers were Globus Maritime Ltd which was down 26.71% to 4.060 in late trade, Oasis Midstream Partners LP which lost 14.25% to settle at 23.95, and Biomea Fusion Inc. which was down 13.49% to 13.47 at the close.
Oil
Oil prices climbed to their highest since October 2018 on Friday, putting both benchmarks up for a fifth week in a row on expectations demand growth will outstrip supply and OPEC+ will be cautious in returning more crude to the market from August. U.S West Texas Intermediate (WTI) crude rose 75 cents, or 1.0%, to $74.05. Those were the highest closes for both benchmarks since October 2018 and put both contracts up over 3% for the week. Crude prices rallied on an improving demand outlook and over expectations, the market will remain tight as OPEC+ is likely to only deliver a small boost to output at the July 1st ministerial meeting. All eyes are on the Organization of the Petroleum Exporting Countries, Russia and allies - together called OPEC+ - who is due to meet on July 1 to discuss the further easing of their output cuts from August. The prospect of sanctions on Iran being lifted and more of its oil hitting the market anytime soon has dimmed.
Precious and Base Metals
Gold prices inched higher today, as the dollar eased and tamer-than-expected U.S. inflation data allayed fears of an early monetary policy tightening by the Federal Reserve. Spot gold was up 0.1% at $1,781.19 per ounce. U.S gold futures rose 0.1% to $1,780.30. The dollar index eased 0.1% against rivals, making gold cheaper for holders of other currencies. U.S consumer spending paused in May, while the personal consumption expenditures price index, the Fed’s preferred inflation measure, came in below expectations. Minneapolis Fed President Neel Kashkari said on Friday he expected recent high inflation readings would not last and Americans would return to the labor market in large numbers in the fall. Republican Senate negotiators on an infrastructure deal were optimistic about a $1.2 trillion bipartisan bill on Sunday after President Joe Biden withdrew his threat to veto the measure unless a separate Democratic spending plan also passes Congress. On the physical front, the gold market in top consumer China flipped into a premium last week as prices eased although activity was subdued, while buyers in India held off for a sharper dip in rates as more jewelers opened up. Speculators cut their net long position in gold by 38,288 contracts to 76,163 in the week to June 22, data from the Commodity Futures Trading Commission showed on Friday. Silver was steady at $26.07 per ounce, palladium rose 0.2% to $2,641.38. Platinum eased 0.1% to $1,109.64. Copper prices held steady on Friday after U.S President Joe Biden embraced a bipartisan Senate infrastructure deal valued at $1.2 trillion over eight years, which helped reinforce expectations of stronger demand. However, worries about the U.S Federal Reserve tightening monetary policy sooner than expected subdued some of the optimism and weighed on copper prices in afternoon trade
Traditional Agricultures
Corn and soybean futures tumbled on Friday after a U.S. Supreme Court ruling bolstered a bid by small oil refineries seeking exemptions from laws requiring them to blend ethanol or other biofuels into their products. Corn and soybeans also faced pressure from rains across large swaths of key U.S growing areas.
Disclaimer
This information has been prepared for information only and does not constitute an offer or commitment. This information does not constitute investment advice as defined by the rules of the FCA.
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