Register to get unlimited Level 2

US open: Stocks tick up ahead of Fed meeting, despite weak data

By Iain Gilbert

Date: Monday 17 Jun 2019

US open: Stocks tick up ahead of Fed meeting, despite weak data

(Sharecast News) - Trading on Wall Street got off to a slightly higher start on Monday, with investors looking ahead to the Federal Reserve's policy meeting later in the week and the upcoming G-20 leaders' summit in Japan.
As of 1530 BST, the Dow Jones Industrial Average was up 0.08% to 26,109.48, while the S&P 500 was 0.19% firmer at 2,892.51 and the Nasdaq Composite had started 0.75% stronger at 7,854.82.

The Dow opened 19 points higher as stocks attempted to stage a rebound after closing lower on Friday when investors reacted to a spate of mixed economic data out of China and tensions between the US and Iran following an attack on two oil tankers in the Gulf of Oman on Thursday.

The week's focus looked set to be squarely on a long list of central bank policy risks, with policymakers at the ECB conference in Sintra likely to provide a steady stream of comments for investors to weigh even as they pondered whether or not the Federal Open Market Committee's, the US central bank's main policy organ, expected dovishness would be enough to satisfy investors hungry for rate cuts.

Elsewhere, Donald Trump warned Americans over the weekend that if he was not re-elected in 2020 there would be "a market crash the likes of which has not been seen before."

In remarks to the Wall Street Journal on Sunday, US commerce secretary Wilbur Ross downplayed the likelihood of a major trade deal should the leaders of the US and China meet at the 28-29 June G-20 leaders' summit, saying Donald Trump was "perfectly happy" to slap further tariffs on China.

"I think the most that will come out of the G-20 might be an agreement to actively resume talks. At the presidential level they're not going to talk about the details of how do you enforce a trade agreement," Ross reportedly said.

Manufacturing sentiment in New York state and northern New Jersey collapsed in June, on the back of fears of a tariff war with Mexico, the results of a closely-followed survey revealed.

The Empire State Manufacturing Index tumbled into negative territory after recording its largest monthly decline on record.

The headline general business conditions index for manufacturing in June, published by the Federal Bank of New York, fell 26 points to -8.6 after new orders receded and shipments increased modestly. That was well below consensus for a reading of somewhere between 10.0 and 11.0, and the lowest reading since October 2016.

Meanwhile, falling interest rates since December had clearly helped, home builders aren't exactly thrilled with their prospects either, according to the National Association of Housebuilders.

The NAHB's housing market index for June fell to 64 in June, shy of both the 66 recorded last month and the reading of 66 expected on the Street.

Ian Shepherdson, chief economist at Pantheon Macroeconomics, linked the drops in the Empire State index and in the NAHB gauge to "peak Mexico tariff fear", which had since subsided.

On the corporate front, auctioneer Sotheby's saw its shares shoot up almost 60% after news that it would be acquired for $3.7bn by BidFair USA, while Array BioPharma shares also surged after being acquired by Pfizer for $10.6bn.

..

Email this article to a friend

or share it with one of these popular networks:


Top of Page