US open: Stocks in the red after Trump speech
With a slew of speeches by Federal Reserve officials in the offing, US stocks were in the red on Thursday as investors digested a disappointing speech by President-elect Donald Trump.
The Dow Jones Industrial Average was down 0.57% to 19,841.10, the S&P 500 fell 0.47% to 2,264.55, and the Nasdaq was weaker by 0.62% to 5.529.32 at 1502 GMT.
Meanwhile, oil prices advanced after Saudi Arabia cut production to less than 10m barrels per day, more than the agreed OPEC-led cull.
West Texas Intermediate rose 2.17% to $53.41 per barrel and Brent crude gained 2.14% to $56.31.
Gold on Comex also gained 0.6% to 1,1203.80 per troy ounce.
Craig Erlam, senior market analyst at Oanda, said: “Donald Trump’s press conference on Wednesday was not what investors wanted to hear, with talk of protectionism and more company bashing not exactly being market friendly. That said, while we did see selling in certain areas, particularly pharmaceutical stocks, overall sentiment did improve into the end of the session and indices finished comfortably in the green.
“We don’t just have Trump’s comments to contend with either, we’ll also get the views of half a dozen Federal Reserve policy makers throughout the day, including Chair Janet Yellen. I doubt their views will have changed too much since the December meeting given that we are none-the-wiser when it comes to Trump’s fiscal and tax plans and the data we’ve had since has been good but probably in line with their expectations.”
In currency markets, the dollar was 0.6% weaker against the sterling to 0.8140, was down 0.85% versus the euro to 0.85% to 0.9370 and declined 1.32% against the yen to 113.89.
Philadelphia Fed President Patrick Harker, who the first official to speak, said that the US economy was gathering strength and to expect three further interest rate hikes in 2017.
Later in the session speeches are due from Atlanta Fed President Dennis Lockhart, Chicago Fed President Charles Evans and St. Louis Fed President James Bullard, while Fed chair Janet Yellen has a town hall meeting with teachers in Washington.
On the data front, initial jobless claims were up 10,000 to 247,000 from the previous week’s level, which was revised up by 2,000. Economists had been expecting a bigger jump to 255,000. This marked the 97th consecutive week of initial claims below 300,000 – the longest streak since 1970.
The four-week moving average came in at 256,500, down 1,750 from the previous week’s average, which was revised up from 256,750 to 258,250.
While import priced rose 0.4% in December, after an upwardly 0.2% revised fall in November. Economists expected a 0.7% rise after an initially reported 0.3% drop.
Export prices increased 0.3% in December after a 0.1% slip the previous month. They were up 1.1% from a year ago.
In corporate news, Applied Optoelectronics soared 25.35% after its preliminary fourth-quarter results late on Wednesday came in well above prior guidance.
Amazon was up 0.78% after the online retail giant said it would create 100,000 full-time jobs by mid-2018.
On opening Campbell Soup was up 2.5% leading gainers in the S&P 500, while energy firm Hess Corp fell 6.4% leading S&P’s laggards, even though oil prices rose.