A free-fall in petroleum stocks was the most striking element of an otherwise lackluster week on Wall Street.
All three indices finished higher for the holiday-shortened week, although the gains in both the Dow and S&P 500 were modest. Markets were closed on Thursday for the Thanksgiving Day holiday and closed three hours early on Friday.
The Dow tacked on 18.18 points (0.1 percent) at 17,828.24, while the S&P 500 rose 4.06 (0.2 percent) to 2,067.56. The tech-rich NASDAQ Composite Index jumped 78.66 (1.67 percent) to 4,791.63.
Photo: Reuters
For November as a whole, the Dow rose 2.52 percent, the S&P 500 2.45 percent and the NASDAQ 3.47 percent.
Petroleum stocks were on the defensive most of the week as investors warily awaited the OPEC meeting on Thursday in Vienna.
OPEC had not been expected to respond aggressively to a roughly 35 percent drop in oil prices since June, but the cartel did even less than many experts predicted, opting not even to promise to stop pumping above its current 30 million barrels per day production ceiling.
“OPEC is clearly signaling that it will no longer bear the burden of market adjustment alone and this decision puts the onus on other producers, especially US tight oil to adjust as well,” Barclays said.
On Friday, Dow members Exxon-Mobil and Chevron fell by 4.5 percent and 5.5 percent, respectively. Oil services companies like Halliburton and Nabors Industries also declined by 10.9 percent and 12.9 percent respectively, along with shale producers Continental Resources (down 19.9 percent) and EOG Resources (down 7.8 percent).
However, the oil price drop had an upside, as airline stocks gained on expectations of lower fuel costs and retailers were lifted as the start of the annual holiday shopping season coincided with an OPEC decision that many analysts see as a boost to consumers’ disposable income.
“Lower gasoline prices are assisting in making holiday spending and confidence rather elevated. Even though consumer spending on gasoline is slightly less than 3 percent of disposable income, it plays a more significant role on consumer mood,” Chris Christopher of IHS Global Insight said.
The US National Retail Federation has predicted that holiday sales this year would rise to US$616.9 billion, up 4.1 percent from last year’s level. Holiday sales accounted for about a fifth of the retail industry’s annual sales last year.
Key factors behind the better outlook include a lengthier holiday shopping season compared with last year, when Thanksgiving fell late in the calendar, and better overall economic data.
In terms of last week’s economic reports, the biggest positive surprise was the US Department of Commerce’s second estimate of third-quarter economic growth, which was revised to an annual rate of 3.9 percent from 3.5 percent. Analysts had expected a downward revision to the initial estimate.
Other reports were mixed. Data for last month showed a slight increase in US consumer spending, a dip in consumer confidence, a rise in durable goods orders and a modest increase in new-home sales. The reports, while somewhat disappointing, “weren’t terrible,” said Michael James, managing director of equity trading at Wedbush Securities.
“Nothing about the data was enough to alter the view that the US economy remains the strongest economy in the world and that US equities remain the best option among worldwide equity markets,” he said.
Next week’s calendar includes the US Federal Reserve’s “Beige Book” of economic conditions and this month’s car sales and jobs report.
Stephen Garrett, a 27-year-old graduate student, always thought he would study in China, but first the country’s restrictive COVID-19 policies made it nearly impossible and now he has other concerns. The cost is one deterrent, but Garrett is more worried about restrictions on academic freedom and the personal risk of being stranded in China. He is not alone. Only about 700 American students are studying at Chinese universities, down from a peak of nearly 25,000 a decade ago, while there are nearly 300,000 Chinese students at US schools. Some young Americans are discouraged from investing their time in China by what they see
MAJOR DROP: CEO Tim Cook, who is visiting Hanoi, pledged the firm was committed to Vietnam after its smartphone shipments declined 9.6% annually in the first quarter Apple Inc yesterday said it would increase spending on suppliers in Vietnam, a key production hub, as CEO Tim Cook arrived in the country for a two-day visit. The iPhone maker announced the news in a statement on its Web site, but gave no details of how much it would spend or where the money would go. Cook is expected to meet programmers, content creators and students during his visit, online newspaper VnExpress reported. The visit comes as US President Joe Biden’s administration seeks to ramp up Vietnam’s role in the global tech supply chain to reduce the US’ dependence on China. Images on
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last
US CONSCULTANT: The US Department of Commerce’s Ursula Burns is a rarely seen US government consultant to be put forward to sit on the board, nominated as an independent director Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday nominated 10 candidates for its new board of directors, including Ursula Burns from the US Department of Commerce. It is rare that TSMC has nominated a US government consultant to sit on its board. Burns was nominated as one of seven independent directors. She is vice chair of the department’s Advisory Council on Supply Chain Competitiveness. Burns is to stand for election at TSMC’s annual shareholders’ meeting on June 4 along with the rest of the candidates. TSMC chairman Mark Liu (劉德音) was not on the list after in December last