America Leads, the Rest of the World Follows

America Leads, the Rest of the World Follows

America Leads, the Rest of the World Follows

$DIA, $SPY, $QQQ, $RUTX, $VXX

Saturday’s truce in the US-China trade dispute put investors in buy mode Monday, driving US stocks due North, extending the market’s gains on last week Key reversal confirmation.

The broad rally followed huge US futures gains that triggered overseas markets as investors welcomed news of the 90-Day negotiating grace period which was agreed to over dinner between Presidents Trump and Xi at the G-20 Summit at the weekend.

The anticipation of the positive developments on trade helped extend last week’s turnaround for the market, which notched its biggest weekly gainer in about 7 years last week after Fed Chairman Powell indicated the central bank is considering a pause in rate hikes next year while it gauges the impact of its credit tightening program.

Tech stocks, automakers, retailers and industrial companies accounted for much of the market’s gainers Monday, offsetting losses in household goods makers.

Energy stocks also climbed as US Crude Oil prices rose sharply.

Markets in Europe also finished higher. Germany’s DAX +1.8%, while France’s CAC 40 +1%, and Britain’s FTSE 100 +1.2%.

What happened in Argentina…

President Trump agreed to hold off on plans to raise tariffs on $200-B in Chinese goods, which were supposed to kick in on 1 January.

In return, Xi agreed to buy a “very substantial amount” of agricultural (soybean), energy (LNG) and industrial products from the US to reduce its large trade deficit with China.

The 2 countries are fast at work drafting a lasting trade agreement now.

Crude Oil prices rose on news that Qatar will withdraw from OPEC in January. The move, which marks the 1st time a Mideast nation has exited the cartel since its founding in Y 1960, came ahead of an OPEC meeting this Thursday.

In addition, the government of the Canadian province of Alberta announced a large cut in Crude Oil production Monday due to a pipe line bottleneck that has supplies backed up.

  • NYMEX WTI Crude Oil gained 4% to settle at $52.95 bbl in New York.
  • ICE Brent Crude Oil rose 3.8% to close at $61.69 bbl in London.

Monday’s pickup in oil prices gave energy stocks a boost

Gains in technology companies helped drive the market North

Auto manufacturers also rose after President Trump said on Twitter late Sunday that Beijing agreed to cut import duties on US autos.

Bond prices rose, as the yield on the 10-year T-Note fell to 2.97% from 3.01% late Friday.

The USD rose to 113.69 JPY from 113.63 JPY late Friday, EUR strengthened to $1.1342 from $1.1309.

Gold gained 1.1% to $1,239.60 oz,. Silver +2% to $14.50 oz and Copper added 0.8% to $2.81 lb.

Monday, the major US stock market indexes finished at: DJIA +287.97 at 25825.33, NAS Comp +110.98 at 7441.72, S&P 500 +30.20 at 2790.64

Volume: Trade on the NYSE came in at 986-M/shares exchanged

  • NAS Comp +7.8% YTD
  • DJIA +4.5% YTD
  • S&P 500 +4.4% YTD
  • Russell 2000 +0.9% YTD

HeffX-LTN’s US Major Stock Market Indexes Technical Analysis

Date Symbol Price Technical Analysis Support Resistance
3 December 2018 QQQ 172.27 Neutral (-0.17) 169.34 173.02
3 December 2018 DIA 258.51 Neutral (0.03) 258.05 261.33
3 December 2018 SPY 279.14 Neutral (-0.09) 278.93 281.01

Stay tuned…

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Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

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