The U.S. equity markets finished the last trading session of the week modestly higher, but failed to post gains for a seventh-straight week, as the omnipresent uncertainty swirling around a U.S.-China “phase one” trade deal that has hampered conviction all week tempered some upbeat news on the manufacturing front and some mixed retail sector earnings reports. Markit’s manufacturing and services sector reports came in stronger than expected, and the University of Michigan’s Consumer Sentiment Index was unexpectedly revised higher. Meanwhile, Gap, Nordstrom, Williams-Sonoma and Foot Locker put the finishing touches on Q3 earnings season for the week. Treasury yields were nearly unchanged and the U.S. dollar was higher, while crude oil and gold prices fell.
The Dow Jones Industrial Average (DJIA) rose 109 points (0.4%) to 27,876, the S&P 500 Index increased 7 points (0.2%) to 3,110 and the Nasdaq Composite advanced 14 points (0.2%) to 8,520. In light volume, 717 million shares were traded on the NYSE and 1.8 billion shares changed hands on the Nasdaq. WTI crude oil lost $0.81 to $57.77 per barrel and wholesale gasoline shed $0.03 to $1.67 per gallon. Elsewhere, the Bloomberg gold spot price was $1.74 lower at $1,462.67 per ounce, and the Dollar Index—a comparison of the U.S. dollar to six major world currencies—rose 0.3% to 98.26. Markets were lower for the week, snapping a six-week winning streak, as the DJIA declined 0.5%, while the S&P 500 Index and the Nasdaq Composite decreased 0.3%.
The preliminary Markit U.S. Manufacturing PMI Index for November rose to 52.2 from October’s unrevised 51.3 figure, and versus the Bloomberg expectation of an increase to 51.4. The preliminary Markit U.S. Services PMI Index showed growth accelerated more than expected for the key U.S. sector this month, rising to 51.6 from October’s 50.6 figure, above forecasts of 51.0. Readings above 50 for both indexes denote expansion.
The final November University of Michigan Consumer Sentiment Index was adjusted higher to 96.8, from the preliminary figure of 95.7, where it was expected it to remain. The index was also above October’s 95.5 level and continued to rebound from the near three-year low posted in August as both the current conditions and expectations components of the index were revised higher. The current conditions component was below the prior month’s level but the expectations portion was above October’s figure. The 1-year inflation forecast remained at October’s 2.5% rate, and the 5-10 year inflation outlook rose to 2.5% from 2.3%.
The November Kansas City Fed Manufacturing Activity Index remained at a level depicting contraction (a reading below zero), matching October’s unrevised -3 reading, versus forecasts calling for it to improve to -2.
Treasuries were nearly flat, as the yields on the 2-year and 10-year notes were unchanged at 1.61% and 1.77%, respectively, while the 30-year bond rate ticked 1 basis point (bp) lower to 2.22%.
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