Stocks were little changed today in New York, with the Dow Jones constrained to its narrowest range of the whole month, with little impetus on hand in the lull between Christmas and New Year.
By Peter Martin
Tuesday, December 30, 2014
By mid-afternoon in New York, the Dow Jones was down just 3 points or 0.02% at 18,051, while the S&P 500 moved a small way in the opposite direction, rising 2.9 points or 0.14% to 2091.2.
Perhaps the largest factor for investors to deal with at the moment is the ongoing decline in the price of oil. The price of US light crude oil futures sunk more than 2% to $53.30 a barrel, after earlier in the trading session dropping below the $52-mark to set a new five-year low. The downward pressure on oil is coming from speculation that the same factors that have beleaguered the commodity this year will continue to be an issue into 2015, namely supply outstripping demand to a significant degree.
Oil-tank fires started last week by militia rockets at Es Sider, Libya’s most important oil port, has been the latest geo-political risk to cause little more than a hiccup in oil’s sharp fall in value, with news today that half of the affected tanks have now been extinguished leading to a resumption of the downward trend. OPEC has so far resisted pressure to curtail production, holding instead to its daily output quota of 30 million barrels.
The euro weakened against the dollar after news that Greek prime minister Antonis Samaras will be calling a snap election for late January as a result of the parliament failing to back his nominated candidate for president. EUR/USD fell 0.19% to 1.2156, but like the stock market, the currency pair has remained within a fairly narrow range today.
The main piece of new on the domestic macroeconomic front today was the results of a regional business survey from the Dallas Fed. Factory output was up strongly in December, though overall business conditions declined from November’s levels. The production index, which gauges how the manufacturing sector in Texas is faring, climbed to 15.8 from November’s level of 6, while the general business activity index dropped to 4.1 from 10.5.
The economic calendar does have a few potential catalysts in store for this week, with the Conference Board’s Consumer Confidence index for December perhaps the highlight, amongst a smattering of housing market data, before we see in the New Year. Then we’re back in full swing on Friday with the two most widely-followed gauges of the manufacturing sector from Markit and the Institute of Supply Management.
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