Stocks were all over the place today. The major indexes started the session little changed before rallying in afternoon trading and then falling back into the red to ultimately close nearly flat. Crude oilcollapsed to a new six-year low.
First, the scoreboard:
- Dow: 17,407.62, +5.11, (0.03%)
- S&P 500: 2,083.03, -3.02, (-0.14%)
- Nasdaq: 5,034.00, -10.38, (-0.21%)
And now, the top stories on Thursday:
- Crude oil fell to a six-year low below $US42 per barrel. West Texas Intermediate crude oil futures tumbled 3% to as low as $US41.92 in New York. This week, data on OPEC’s output at a three-year high and bullish production forecasts from the International Energy Agency made it clearer that the market is oversupplied, and demand is not catching up.
- China devalued its currency for a third day running. The People’s Bank of China fixed the yuan at 6.4010 against the dollar, the weakest since October 2012. Some analysts have said this is all in a bid to stimulate China’s economy, and make exports more attractive. Around 9:15 p.m. ET, market watchers will again be on standby for any news from Beijing.
- In economic data, retail sales rose 0.6% month-on-month and 0.4% excluding auto and gas, in line with forecasts. The biggest jump over the past year, at 9%, came from food services and drinking places, or, restaurants and bars. The data for June were revised up from previous negative prints. HSBC’s Ryan Wang said in a client note that the retail sales numbers show consumer spending is on track after weakness in the first half of the year. “This report looks solid after a run of disappointing numbers, and it bolsters the case for a September rate hike,” Pantheon Macroeconomics’ Ian Shepherdson wrote in a note to clients.
- Initial jobless claims totaled 274,000 last week, and the four-week moving average fell to a 15-year low of 266,250. “The very low level of claims — near all-time lows, when adjusted for population growth — is consistent with companies’ complaints that they can’t find qualified staff,” Shepherdson wrote.
- Shake Shack shares fell nearly 15%. The burger chain priced its 4-million-share stock offering at $US60 per share after the market close on Wednesday — $US5 below the closing price. The stock fell to as low as $US54.11 per share, and is down about 30% from highs reached in May.
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