Amidst the gloom, oil stocks are reporting record profits
US equities finished mostly lower in Tuesday trading, as traders assessed better-than-expected economic data and prepared for another likely rate hike from the Federal Reserve.
All the major averages opened higher but turned negative after job openings in September showed a resilient labour market. The news heightened fears that the central bank may keep its aggressive stance as it fights to tame high inflation.
The Dow Jones Industrial Average fell 0.24 per cent while the S&P 500 slid 0.41 per cent and the Nasdaq Composite shed 0.89 per cent.
Tuesday marked the start of the Fed’s November meeting, which many expect will result in a 75 basis point interest rate hike on Wednesday. Investors will monitor the central bank’s statement and Fed Chair Jerome Powell’s press conference for signs of a slowing tightening pace.
Some losses were mitigated Tuesday as a better-than-feared earnings season continued with a strong report from Pfizer. The stock closed up just over 3 per cent.
Johnson & Johnson said on Tuesday it struck a deal to buy heart pump maker Abiomed Inc. for $16.6 billion in cash, as it looks to boost growth in its medical devices unit after next year's planned spinoff of the consumer health business. J&J agreed to pay a 50 per cent premium over its closing price. Abiomed closed up nearly 50 per cent to $378.
Uber shares popped nearly 12 per cent on a revenue beat. Companies this season have grappled with high inflation, rising rates and a strong dollar.
Across the sectors, energy was the standout, as oil prices rose on optimism that China, the world’s second-largest oil consumer, could reopen from strict COVID curbs.
Profits at two of the world’s largest oil producers soared as BP and Saudi Aramco reaped a windfall from historically high energy prices that have fuelled inflation and stoked a global cost of living crisis. Saudi Aramco reported its second-highest quarterly profits since listing its shares in 2019, generating net income of $42.4bn in the three months to September, as BP’s earnings more than doubled to $8bn, putting it on course for one of the most profitable years in its history.
Oil companies are increasingly in the crosshairs of governments in Europe and the US, which are exploring additional levies and possible windfall taxes to make up shortfalls in national budgets.
And Chinese stocks briefly soared on hopes of an end to zero-Covid policies. Shares in Chinese companies jumped nearly 7 percent today amid speculation on social media that Beijing was taking tentative steps to ease tough pandemic policies.
Currencies
One Australian dollar is flat compared to the US dollar yesterday, buying 63.93 US cents (Tue: 63.97 US cents), 55.68 Pence Sterling, 94.78 Yen and 64.74 Euro cents.
Commodities
Iron ore futures are pointing to a 1.7 per cent gain.
Gold added $9.10 or 0.6 per cent to US$1650 an ounce.
Silver gained $0.50 or 2.6 per cent to US$19.62 an ounce.
Copper jumped $9.15 or 2.7 per cent to US$346.65 a pound.
Oil added $1.69 or 1.9 per cent to US$88.22 a barrel.
Futures
The SPI futures are pointing to a 0.1 per cent gain.
Figures around the globe
Across the Atlantic, European markets closed higher. Paris added almost 1 per cent, Frankfurt added 0.6 per cent and London’s FTSE closed 1.3 per cent higher.
In Asian markets, Tokyo’s Nikkei added 0.3 per cent, Hong Kong’s Hang Seng jumped 5.2 per cent and China’s Shanghai Composite closed 2.6 per cent higher.
Yesterday the Australian sharemarket gained 1.7 per cent to close at 6977.
Ex-dividends
EVT (ASX:EVT) is paying 12 cents fully franked.
Jupiter Mines (ASX:JMS) is paying 1 cent unfranked.
Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap.
Copyright 2022 – Finance News Network
Source: Finance News Network
