Global stock indices at new highs - 17.3.2017

US stocks slip on profit taking in healthcare sector

US stocks fell on Thursday on profit-taking in healthcare sector which is one of the best performing sectors so far this year. Donald Trumps proposed the budget which signals for higher regulatory costs for the sector and cut the federal funding for medical research. Financials outperformed, rebounding after the poor performance on Wednesday in the wake of the Fed rate hike. US dollar fell to a five-week low on Thursday while US bond yields increased after the Fed rate hike and indication that monetary tightening will not speed up. US dollar index, a measure of a greenback’s value against a basket of six major currencies, fell 0.5% to 100.160. S&P 500 index slid 0.16% to 2,381.38. Dow Jones industrial average lost 0.07% to 20,934.55 while Nasdaq composite added 0.01% to 5,900.76. Oracle shares hit a fresh high at $46.99 on unexpectedly positive earnings report. Today at 16:00 CET the Confidence index by Michigan University for February will come out in the US as well as some preliminary indicators on current economic conditions, expectations, inflation and leading indicators for March. At 19:00 CET the Baker Hughes US rig count will come out in US.

Europeans stocks at 15-month highs

European stocks advanced on Thursday after the victory by Dutch Prime Minister Mark Rutte in elections in Holland on Wednesday mitigating concerns over anti-EU views and as Fed sounded dovish about the timing of the rate hikes this year. The Amsterdam’s AEX stock index hit a 9-year high, up by 0.6%, while German DAX 30 and French CAC 40 soared to their highs since mid-2015. European banking stocks advanced 1% following the Fed decision. Basis resource stocks were also on the rise, lifter by weaker US dollar. The pan-European STOXX EUROPE 600 index advanced 0.7% to its record high since December 2015 on dovish Fed sentiment and Dutch elections. This weekend markets await the G20 finance leaders’ meeting in Germany.

Asian stocks perform best since July

Asian stocks were on the rise on Friday set for their best week since July 2016 as US dollar continued sliding down after the Fed rate hike. Nikkei fell 0.45% on Friday and 0.4% so far this week. USDJPY was steady at 113.32 yen on Friday but posted a 1.2% loss this week. Hong Kong stocks reached their 19-month high on Friday recording their best week in 6 months. Hang Seng index climbed to the intraday high of 24,385.81 points but then retreated a bit to close up 0.3% at 24,354.89. In mainland China blue-chip CSI 300 index lost 0.2% to 3,474.27 points while Shanghai Composite index slid 0.2% to 3,261.16.

Oil advances on weak US dollar

Oil futures prices are advancing on Friday on weaker US dollar and news from OPEC. The Saudi energy minister said on Thursday that OPEC members and non-OPEC oil producers may extend the oil production cut beyond June in case oil stocks stay above a long-term average. Brent crude futures added 31 cents to $52.05 a barrel while WTI oil added 0.33 cents to $49.08.

Gold steady on Friday

Spot gold stood almost flat at $1,226.31 an ounce on Friday. US gold futures remained also nearly unchanged at $1,226.20. This week gold is set for the first weekly increase in three weeks after the Fed hiked the rate by 25 basis points on Wednesday which pushed the US dollar to its 5-week low. Spot silver lost 0.3% to $17.23 an ounce retracing after its strong performance the day before.