Stocks barely moved today. But they’re still sitting near all-time highs.
First, the scoreboard:
Dow: 16,184.9(+17.0, +0.1%)
S&P 500: 1,810.1 (-0.5, -0.0%)
Nasdaq: 4,059.0 (-11.0, -0.2%)
And now the top stories:
U.S. stocks set new all-time highs yesterday after the Fed announced it would be tapering its stimulative quantitative easing program. And today, there wasn’t a major giveback, which was good news for investors.
However, gold tumbled to below $1,200, a level it hadn’t seen since June. Most analysts believe that the Fed’s tapering of quantitative easing and eventual tightening of monetary policy will be bullish for the dollar and therefore bearish for gold. “Ultimately, the Fed’s decision should weigh down on gold and open up further downside from here,” wrote UBS’s Joni Teves and Edel Tully. “Gold is bound to struggle as the Fed pursues normalisation.”
Initial unemployment claims jumped to 379,000 from 369,000 a week ago. This was much higher than the 336,000 level expected by economists. “We continue to note that the recent spike in claims is caused exclusively by seasonal volatility and the Labor Department’s struggle to adequately adjust the data,” said TD Securities’ Gennadiy Goldberg. “While the Labor Department suggested looking more closely at the less volatile 4wk MA (up to 344K from 330K last week), we believe that it is a good idea to largely discount claims data for the next few weeks. We expect seasonal volatility to obscure the ‘true’ trend in claims, which we see in the 315K-335K range, until late-January.”
The Philadelphia Fed’s survey of business conditions was weaker than expected climbing just 0.5 points to 7.0 in December. “This report brings the 2013 average to 6.4, an improvement from the 2012 average of -0.2 and just below the 2011 average of 7.7,” noted Barclays’ Cooper Howes. “We expect a further pickup in manufacturing activity in 2014.”
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