Equity Market Insight from Nasdaq MID - December 12, 2017

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Tuesday, December 12, 2017, 11:45 AM, EST

  • NASDAQ Composite +0.10% Dow +0.55% S&P 500 +0.28% Russell 2000 +0.32% S&P MID 400 +0.1%
  • NASDAQ Advancers: 1331 Decliners: 922
  • Today's Volume (100 day avg) -3%

The Dow is up triple digits this morning, while the Nasdaq and S&P 500 are little changed. Boeing (+3%) and Goldman Sachs (+1%) are supplying the upside support in the Blue Chip Index. A 2 day Fed meeting will kick off today, setting up for tomorrow's anticipated rate hike, while Fed economists will be looking for clues to update their "dot plot."

  • November's PPI (ex Food and ex Energy) was up 0.4% MoM and up 3.1% YoY (largest advance since Jan 2012), suggesting demand is moving at a healthy clip. A majority of the increase was attributed to a 1.0% jump in final demand goods, and led by a 15.8% rise in gasoline prices.
  • Brent crude oil touched a 2.5 year high in early trading on word that cracks were found in a pipeline that delivers about 40% of the UK's North Sea production, but the gains have since faded on profit-taking. On this side of the pond the price of heavy crude out of Canada's tar sand falls to a 3-year low because the pipeline and railcar infrastructure is inadequate for transporting current production. [WTI -0.5%; Brent -0.4%]
  • Shopping Malls across the United States have been closing at an elevated clip over the past 10 years, as the industry has lost its luster, while online shopping has taken off. Today, a deal in the space has given Shopping Mall stocks a boost and some enthusiasm. French property company, Unibail-Rodamco SE announced they will attempt to acquire Westfield Corp for $16 billion, suggesting "that there is a bid for these malls", according Jeffrey Langbaum from Bloomberg Intelligence.

Technical Take:

"Silver and gold, silver and gold" …. Precious metals gold and silver started off strong in 2017 with gains of 5.5% and 10.2% for the month of January, but since then both have meaningfully underperformed equities. Gold at least has maintained its January gains and is up 7.8% YTD, however silver has given it all back and then some as it is currently down (1.7%) YTD to a last sale of $15.66. Silver is now at a critical inflection point as today's intraday low, $15.62, is nearly equal to the YTD closing low of $15.60, and the December 2016 intraday low of $15.63. Over the last 12-months this has proven to be a clearly defined support line which now is being tested for the four consecutive days with little bounce. Downside momentum is already extended with the daily RSI now at 27 which indicates over the near term sellers may not yet be ready to break through and hold price down below the $15.60 support. This week's close will be important given tomorrow's FOMC announcement, the weekly candlestick pattern, and whether or not the $15.60 support can hold firm. Despite the holidays, seasonality trends are unfavorable for December with silver now on pace to finish the month in Santa Claus red in seven of the prior ten years. Conversely January has finished in the green in seven of the prior ten years. The adage "know your time frame" is the important silver lining.

Please see Nasdaq Revitalize page, where we make recommendations about improvements to the capital markets to promote growth, innovation, job formation and wealth creation. We welcome your feedback on our proposals to reduce burdens on companies with proxy reform, short sale disclosure, and tax, litigation & disclosure reform.

Nasdaq's Market Intelligence Desk (MID) Team includes:

Michael Sokoll, CFA is a Senior Managing Director on the Market Intelligence Desk (MID) at Nasdaq with over 25 years of equity market experience. In this role, he manages a team of professionals responsible for providing NASDAQ-listed companies with real-time trading analysis and objective market information.

Jeffrey LaRocque is a Director on the Market Intelligence Desk (MID) at Nasdaq, covering U.S. equities with over 10 years of experience having learned market structure while working on institutional trading desks and as a stock surveillance analyst. Jeff's diverse professional knowledge includes IPOs, Technical Analysis and Options Trading.

Steven Brown is a Managing Director on the Market Intelligence Desk (MID) at Nasdaq with over twenty years of experience in equities. With a focus on client retention he currently covers the Financial, Energy and Media sectors.

Christopher Dearborn is a Managing Director on the Market Intelligence Desk (MID) at Nasdaq. Chris has over two decades of equity market experience including floor and screen based trading, corporate access, IPOs and asset allocation. Chris is responsible for providing timely, accurate and objective market and trading-related information to Nasdaq-listed companies.

Annie O'Callaghan is Director on the Market Intelligence Desk (MID) at Nasdaq. Annie has worked for NASDAQ in a variety of roles including support of Nasdaq C-level management in client retention and customer service. Annie also served as a Sales Director in Nasdaq's Transactions Services business. Prior to joining Nasdaq, Annie worked at AX Trading, managing accounts for its Alternative Trading System and served on Credit Suisse's trading desk as an Electronic & Algorithmic Sales Trading Analyst.

Brian Joyce, CMT has 16 years of trading desk experience. Prior to joining Nasdaq Brian executed equity orders and provided trading ideas to institutional clients. He also contributed technical analysis to a fundamental research offering. Brian focuses on helping Nasdaq's Financial, Healthcare and Airline companies among others understand the trading in their stock. Brian is a Chartered Market Technician.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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