The Dow and S&P 500 both slipped on Tuesday, ending their streak of record highs, while oil prices tumbled after reports ahead of Thursday’s OPEC meeting gave a mixed view on whether the cartel would agree to production cuts.
First, the scoreboard:
- Dow: 17,814.9, -3, (-0.02%)
- S&P 500: 2,067, -2.4, (-0.1%)
- Nasdaq: 4,758.2, +3.3, (+0.07%)
And now, the top stories on Tuesday:
1. The big story on Tuesday was oil. West Texas Intermediate crude futures fell to $US74 on Tuesday, a decline of more than 2%, or more than $US1.80 after reports from Reuters early in the day said that officials from Saudi Arabia, Mexico, Russia, and Venezuela met ahead of Thursday’s OPEC meeting, with the sides not agreeing to cut production. A report from The Wall Street Journal said that at Thursday’s meeting, Saudi Arabia will “likely side with calls for the group to adhere more closely to its self-imposed production ceiling,” which the cartel hasn’t been firm on since reaching a 30 million barrel per day production target three years ago.
2. The first revision to third quarter GDP came in way better than expected on Tuesday morning, with the BEA’s revision showing the US economy grew at a 3.9% annualized pace in the third quarter, better than the 3.5% initial reading and the 3.3% revised pace that was expected by Wall Street economists.
3. We also got housing data from the S&P/Case-Shiller home price index, which showed home prices rose 0.34% in September, the first month-on-month increase since April. Expectations were for the report to show a 0.3% increase.
4. Yale professor Robert Shiller, the Shiller half of the Case-Shiller index, appeared on CNBC following the latest release and noted that the futures market is currently expecting home prices to rise 5% a year over the next two years, which Shiller said seems reasonable. Shiller also talked a bit about the stock market, which according to his CAPE Shiller P/E ratio is historically expensive, but Shiller said he is still in the stock market.
5. We also got consumer confidence data on Tuesday from The Conference Board, with November’s report disappointing. The report showed consumer confidence fell to 88.7 in November, down from 94.5 last month, and widely missing expectations for a 96 reading. The Conference Board’s Lynn Franco said following the report, “Consumer confidence retreated in November, primarily due to reduced optimism in the short-term outlook.”
6. Apple hit a new all-time on Tuesday, and the iPhone maker’s market cap crossed the $US700 billion threshold for the first time.
7. The latest household debt survey from the New York Federal Reserve showed that household debt rose to $US11.71 trillion in the third quarter, up from $US11.62 trillion the prior quarter. “Outstanding household debt, led by increases in auto loans, student loans and credit card balances, has steadily trended upward in recent quarters,” said Wilbert van der Klaauw, senior vice president and economist at the New York Fed. Overall, household debt is below its $US12.68 trillion peak reached in the third quarter of 2008.
Business Insider Emails & Alerts
Site highlights each day to your inbox.