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U.S. stocks set for gains after upbeat Chinese factory data

Discussion in 'Real Estate & Other Investments' started by Scorpio, Nov 1, 2016.



  1. Scorpio

    Scorpio Скорпион Founding Member Board Elder Site Mgr Site Supporter ++

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    U.S. stocks set for gains after upbeat Chinese factory data

    By Sara Sjolin
    Published: Nov 1, 2016 6:24 a.m. ET



    U.S. manufacturing PMI and ISM data are also in focus


    [​IMG] STR/AFP/Getty Images
    Chinese manufacturing is expanded at its fastest pace in two years
    U.S. stocks were poised to rebound Tuesday, with futures pointing higher after strong Chinese manufacturing data instilled more confidence in global growth and sent global stock markets higher.

    Investors were waiting for the latest on U.S. manufacturing, with purchasing managers’ index and ISM data due early in the day.

    Futures for the Dow Jones Industrial Average YMZ6, +0.25% rose 28 points, or 0.2%, to 18,090, while those for the S&P 500 index ESZ6, +0.32% added 4.40 points, or 0.2%, to 2,124.25. Futures for the Nasdaq 100 index NQZ6, +0.28% gained 7.75 points, or 0.2%, to 4,804.50.

    The gains came after all three benchmarks ended lower on Monday, as a drop in oil prices and uncertainty ahead of the U.S. presidential election next week weighed on investors’ minds.

    On Tuesday, oil prices were in recovery mode, helping give sentiment about equities a slight boost. Crude oil CLZ6, -0.36% was up 0.1% at $46.88 a barrel, while Brent LCOF7, +0.06% added 0.4% to $48.81.

    Stock markets were also buoyed by upbeat data from China, where the official manufacturing PMI for October rose to a two-year high of 51.2, from September’s 50.4.

    “Chinese PMI data for October surprised strongly on the upside, adding to the picture of a global recovery and putting more fuel on the reflation theme,” analysts at Danske Bank said in a note.

    “The data are positive for risk assets, as they underpin the picture of a global cyclical rebound,” they added.

    Stocks, which are considered risk assets, closed mostly higher in Asia, with Hong Kong’s Hang Seng HSI, +0.93% rising 0.9%. European stocks opened higher, but turned lower midmorning as disappointing earnings reports came in. Prices of metals, which are sensitive to growth news out of China, rose across the board.

    Economic news: Manufacturing activity was also a focus in the U.S., where the Markit PMI and the ISM index are due to come out at 9:45 a.m. Eastern Time and 10 a.m. Eastern, respectively.

    Economists polled by MarketWatch expect the ISM to inch up to 51.7% from 51.5% in September.

    “In theory, weak growth in the ISM index might be negative for the dollar,” said Marshall Gittler, head of investment research at FXPrimus, in a note.

    “However, the closely watched ISM prices paid index is forecast to rise as well. That’s seen as a harbinger of inflation trends. If that turns up, then even if the economy slows, the [Federal Reserve] can still go ahead and tighten policy. That would make it positive for the dollar,” he added.

    The ICE dollar index DXY, -0.16% was down 0.2% at 98.208 premarket on Tuesday.

    The Fed will announce its latest rate decision on Wednesday, but is widely expected to keep interest rates on hold. For the December meeting, however, analysts are forecasting a rate hike.

    Movers and shakers: U.S.-listed shares of Royal Dutch Shell PLC RDSB, +3.72% RDS.B, -0.89% rose 4% ahead of the open after the oil giant reported a rise in third-quarter profit.

    Shares of Brocade Communications Systems Inc. BRCD, +21.98% could also be active, after they soared more than 20% on Monday on reports it is in advanced talks to sell itself.


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    http://www.marketwatch.com/story/us...-after-upbeat-chinese-factory-data-2016-11-01
     
  2. Scorpio

    Scorpio Скорпион Founding Member Board Elder Site Mgr Site Supporter ++

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    Know when to fold ’em: The stock market just gave us 3 ominous ‘tells’
    By Shawn Langlois
    Published: Nov 1, 2016 5:41 a.m. ET






    [​IMG] Getty
    Time to take some chips off the table?
    Taking his place among some of the stock market’s most pessimistic doomsayers, Graham Summers, chief market strategist at Phoenix Capital Research, has been extremely bearish on equities for a long time. Some of his alarmist headlines include “Stocks could lose 90% over the next two years” and “The Fed has set us up for a massive 50% collapse,” to name just a couple.

    Well, he ramped up the urgency again Monday with a timely Halloween post laying out a fresh batch of warning signs — or “tells,” as he describes them.

    “This has the makings of a financial crisis,” Summers wrote. “The whole mess is starting to feel a LOT like 2008 again.”

    Here are those “tells,” and the charts to go with them:

    1. Bond yields are spiking around the world. “With bond yields rising, earnings yields will follow,” Summers explained. “The only way for earnings yields to rise is for stock prices to FALL.”

    [​IMG]


    2. Only a few stocks are holding the market up. “The number of individual companies above their 50-day moving averages has been in a virtual free fall since February,” he said. “Literally a handful of companies remain strong. Everything else is breaking down.”

    [​IMG]


    3. Earnings are a mess. “At the end of the day, investors buy stocks for earnings,” Summers said. “But earnings have already collapsed to levels not seen since 2012.”

    [​IMG]

    http://www.marketwatch.com/story/kn...arket-just-gave-us-3-ominous-tells-2016-10-31
     
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