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Daily Review 30.11.2016

Stocks jump, dollar falls as US economy posts best performance in two years

US equity markets finished in the green zone while the dollar ended in the red territory on Tuesday trading as the country’s economy grew at its fastest rate since 2014 according to the Commerce Department.

The country’s gross domestic product smashed economists’ expectations of 3.0% growth rate as it rose 3.2% in the third quarter, up from the feeble 1.4% pace recorded in the second quarter.

It was the best performance for the US economy since the same quarter of 2014, backed up mainly by the strong consumer spending and robust exports growth, showing an increase of 2.8% and 0.87% respectively from the months July to September.

The strong output was also driven by the 5.5% surge in US home prices which proved that the house prices have escaped the nightmare of the 2008 financial crises when it plunged dramatically.

The news steered the US stock indices to edge higher on yesterday’s trading with the energy sector S&P 500 gaining 0.1% and was up 6.0% since the November 8 elections. The blue chip Dow Jones industrial average added 25 points while the NASDAQ Composite finished up 0.2%.

Meanwhile, the US dollar fell 0.34% down, to close at 100.99, the first pullback in the currency since the victory of President-elect Donald Trump.

The Japanese yen gained 0.44% strength against the greenback at 112.41 while the euro closed up at 1.0638.

Oil plunges to two-week low as Iran pulls out of production cut

Oil prices slid to its lowest level in two weeks on Tuesday after Iran refused to give the production cut a nod.

The Iranian Oil Minister Bijan Zanganeh claimed that the country will stick at the level of crude supply agreed last September when the members of the Organization of the Petroleum Exporting Countries met in Algeria, which means Iran will not cut its output.

The anticipation of action to cut oil production has kept oil prices afloat in the recent weeks, even reaching the above $50 level, but doubts over OPEC’s to reach the agreement has dragged down oil prices days ahead of the meeting in Austria.

US’ West Texas Intermediate lost $1.85 or 3.9% and was last trading at $45.23 a barrel, its lowest since November 14.

The international benchmark Brent crude oil dropped $1.86 or 3.9% and finished at $46.38 per barrel.

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