US stocks closed marginally higher on Monday switching between gains and losses as energy sector fell with falling oil prices. The dollar strengthened, live dollar index data indicate the ICE US dollar index, a measure of the dollar’s value against a basket of six major currencies, edged up 0.5% to 98.784. The Dow Jones Industrial Average added 0.3% to settle at 16.398.57 after falling 6.2% last week. The S&P 500 gained less than 0.1% as energy stocks led the decliners with 2% loss. Biotech stocks were down 3.4% as investor turned risk averse, dragging Nasdaq Composite down 0.1%. Fourth-quarter earnings season starts this week, and analysts expect overall earnings will decline by 5.3%. Alcoa (N:AA) shares rallied 2.5% in after-hours trading on better-than-expected fourth quarter report. Apple (O:AAPL) closed 1.6% higher after the iPhone maker was upgraded by Mizuho Securities, which pointed to upside potential after recent selloff. J.P. Morgan Chase (N:JPM), Wells Fargo (N:WFC) and Citigroup (N:C) will report results at the end of the week.
Today at 11:30 CET US Federal Reserve Vice Chair Stanley Fischer will speak at a Bank of France symposium in Paris. At 16:00 CET December Job Openings and Labor Turnover Survey, and Investor's Business Daily Economic Optimism Index for January will be published. The tentative outlook is positive. At 21:15 CET Federal Reserve Bank of Richmond President Jeffrey Lacker speaks on economic outlook in Columbia, South Carolina.
European stocks fell on Monday as falling commodity shares weighed on market indexes. The euro weakened against most major currencies and lost 0.6% against the dollar, which helped limit the losses in export oriented sectors. The Stoxx Europe 600 closed down 0.3% at 340.23, retreating for the fourth session in a row and hitting the lowest level since September. Germany's DAX 30 fell 0.3%, France's CAC 40 and UK’s FTSE 100 indexes dropped 0.5% and 0.7% respectively. Shares of mining companies slumped with Glencore (L:GLEN) and Rio Tinto (L:RIO) dropping 5.2% and 2.4%. Oil companies dropped as oil prices continued falling, Royal Dutch Shell (L:RDSa) fell 1.5%, BG Group (L:BG) lost 2.4% and Statoil ASA (N:STO) sank 2.8%. Today at 11:30 CET European Central Bank Executive Board Member Peter Praet will speak in Paris. At 20:00 CET ECB Executive Board Member Sabine Lautenschlaeger will speak on economic outlook in Frankfurt.
Nikkei fell 2.7% today as plunging oil prices hurt risk appetite and yen advanced against the dollar. Japan’s current account balance came in worse-than-expected, falling to 1.42 trillion from 1.49 trillion yen in October. Investor confidence was undermined also by Prime Minster Abe's comments about possible tax raises so long as there isn't a credit crisis like the Lehman event in 2008.
Chinese stocks advanced today, the Shanghai Composite Index rose 0.4% as the Chinese yuan stabilized. China’s National Reform and Development Commission said the government approved 280 fixed asset investment projects worth 2.52 trillion yuan ($383.44 billion) in 2015.
Oil futures prices are falling today after hitting 12-year lows on Monday. February WTI fell 5.3% to $31.41, below a key technical support level of $32. February Brent crude lost 6% to end at $31.55 a barrel on London’s ICE Futures exchange. Oil prices are falling as global production exceeds demand and global stockpiles are at record levels. Meanwhile, futures contracts for 2018 and beyond have also slumped as markets are pricing in a longer-lasting downturn.