Tuesday 20 March 2018

American stocks extend gains as Opec cut helps lift crude oil

A board displaying exchange rates is seen at a foreign exchange house in Mexico City
A board displaying exchange rates is seen at a foreign exchange house in Mexico City


US stocks extended to all-time highs as crude rallied, while Treasuries slipped with gold after a White House promise to overhaul business taxes rejuvenated reflation trades.

The S&P 500 Index padded an all-time high, with energy producer pacing gains after oil retook $54 a barrel amid Opec output cuts. Copper surged the most since 2013 as China stepped up exports and a workers went on strike at a major mine. The Bloomberg Dollar Spot Index pared its first weekly gain of the year after sentiment among American consumers cooled from a 13-year high. European stocks capped a weekly advance.

While the confidence report broke a streak of rising sentiment indicators among consumers and businesses that've shown optimism that Donald Trump will deliver on pro-growth policy promises, his comment Thursday that he'll outline a "phenomenal" tax plan within weeks lifted trades that had stalled while the administration focused on immigration and protectionist policies. Former Goldman Sachs president Gary Cohn is leading the tax effort, a White House official said.

"The obvious implication is that bond yields go higher," Michael Bell, a global market strategist at JPMorgan Asset Management, said on Friday.

"We don't really buy the rally in government bonds that you've seen in recent weeks. Bond yields in the US will head to about 3pc."

The tone didn't translate to Ireland, however. The ISEQ index closed the day down slightly at 6472.68.

Among bigger shares, Ryanair was down 2.25pc at €14.115 a share, still under pressure after it missed quarterly earnings targets earlier in the week. Ferry operator ICG led the main risers, up 4.899pc to €2.66pc. The Stoxx Europe 600 index was little changed as it headed for an advance of 0.8pc in the five days.

Irish Independent

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