US stock market rises ahead of elections results - 7.11.2018

Nasdaq joins Dow and SP500 rally

US equities rebound continued on Tuesday ahead of results of midterm elections. The S&P 500 gained 0.6% to 2755.44. Dow Jones industrial average rose 0.7% to 25635.01. The Nasdaq composite index added 0.6% to 7375.96. The dollar weakening continued despite strong labor market data: there were 7 million job openings in the US in September, after a 7.3 million in August. The live dollar index data show the ICE US Dollar index, a measure of the dollar’s strength against a basket of six rival currencies, slipped 0.1% to 96.241 and is lower currently. Futures on stock indices indicate higher openings today.

Polls suggested the Democrats would take the House of Representatives while the Republicans will retain control of the Senate. And results show Democrats won control of the House of Representatives. Analysts don’t expect such a gridlock may derail the US economic growth based on historic market performance. However some point that gridlock in Washington makes more tax cuts, which Trump has called for, very unlikely.

SP500 tests MA(200) Market Overview IFCM Markets chart

European indices opened higher

European stocks pullback continued on Tuesday despite positive reports: euro-zone data showed a narrow beat for composite and services PMIs for October, and the producer price index accelerated its gains in September. Both the EUR/USD and GBP/USD continued rising and are higher currently. The Stoxx Europe 600 lost 0.3%. The German DAX 30 slipped 0.1% to 11484.34. France’s CAC 40 slid 0.5% while UK’s FTSE 100 fell 0.9% to 7040.68. Indices opened 0.3% - 0.5% higher today.

Australia’s All Ordinaries Index best performer among Asian indices

Asian stock indices are mixed today. Nikkei ended 0.3% lower at 22085.80 as yen strengthened against the dollar. Chinese stocks are lower as US trade dispute is back in focus after elections uncertainty resolved: the Shanghai Composite Index is down 0.7% and Hong Kong’s Hang Seng index is 0.2% lower. Australia’s All Ordinaries Index extended gains 0.4% despite continuing Australian dollar climb against the greenback.

Brent edges up

Brent futures prices are edging higher today. Prices fell yesterday after the Trump administration granted waivers to eight nations to continue importing Iranian crude despite re-imposed US sanctions against the Islamic Republic. The American Petroleum Institute reported late Tuesday that US crude inventories rose by 7.8 million barrels last week to 432 million. January Brent fell 1.4% to $72.13 a barrel Tuesday. Today at 16:30 CET the Energy Information Administration will release US Crude Oil Inventories.