Dow Jones Industrial Average was trading higher on Wednesday amid a slew of better than expected data. Today is the last full trading day of the week, as markets will be closed Thursday and end trading at 1 PM ET Friday.
On the economic front, the number of Americans filing for jobless benefits fell more than projected last week. Initial claims for unemployment benefits dipped 12,000 to a seasonally adjusted 260,000 for the 7-days ending November 21, the Labor Department said today. Economists surveyed by Reuters had expected claims to drop to 270,000 last week.
Orders for durable goods increased 3% in October, the Commerce Department said Wednesday. Last month’s rise follows declines in both September and August. The strength was due to surge in demand across a number of categories, including commercial aircrafts, machinery and computers.
Dow Jones Industrial Average Receives Goldman Jolt
The U.S. stock markets, including the Dow Jones Industrial Average , will continue to trade sideways in 2016, as interest rates rise faster than expected, analysts at Goldman Sachs said late yesterday.
The team of analysts led by U.S. equity strategist David Kostin still forecasts earnings to rise 10% to $120 a share in 2016 and $129 per share in 2017.
“Fed hikes will begin in December and continue steadily for several years” they wrote in the report.
Crude Oil Tumbles 2%
Oil prices fell as much as 2% after some traders decided to book their profits following yesterday’s rally to 2-week highs.
WTI futures dropped 78 cents to fall to $42.09 a barrel. Brent lost 95 cents, or 2 percent, to $45.17 a barrel, reversing gains made earlier in the session.
“In Asian hours you are seeing some profit-taking,” Daniel Ang, an analyst at Phillip Futures, wrote to clients.
He however went on to add “bullish sentiment is continuing,” and that “economic data should further support this momentum.”
Today’s downslide was also supported by some negative oil data. The American Petroleum Institute said U.S. crude inventories rose by 2.6 million barrels last week. Analysts were expecting an increase of 1.2 million barrels.
Treasurys Rise on Safe Haven Demand
Just like the Dow Jones Industrial Average, U.S. bonds prices were also trading higher on Wednesday, pushing yields lower. The rise in tensions in the Middle-East increased demand for the safe haven asset. Gains were somewhat capped by an encouraging set of economic data.
10-year Treasury yields fell to trade around 2.226 percent, after ending Tuesday at 2.243 percent. Yields on 30-year bonds sank below the 3 percent mark to trade around 2.990 percent after closing last session at 3.006 percent.
“As a result of the expected first rate hike in December, 10 Year Treasury yields are set to end at 2.32 percent by the end of the year and edge at 2.64 percent by end-2016,” Bronka Rzepkowski, senior global strategist at Oxford Economics, told CNBC.
The U.S. Treasury is also scheduled to auction $29 billion in 7-year notes, later on Wednesday.
Dow Jones Industrial Average was last trading at 17815.36, up 0.1%.
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