Oil futures rebound on eve of OPEC meeting

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Oil futures rallied on Thursday, as talk of a possible cut in production from the Organization of the Petroleum Exporting Countries and weakness in the U.S. dollar helped crude recoup nearly 3% of a decline that took the U.S. benchmark below $40 a barrel.

On the New York Mercantile Exchange, January West Texas Intermediate crude tacked on $1.14, or 2.9%, to settle at $41.08 a barrel. January Brent crude rose $1.35, or 3.2%, to $43.84 a barrel on London’s ICE Futures exchange.

Source: MarketWatch

U.S. Stocks Tumble Amid Yellen Testimony, ECB Stimulus Moves

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The Standard & Poor’s 500 Index slumped the most in two months as Federal Reserve Chair Janet Yellen signaled the economy is nearly ready for higher borrowing costs, while the scale of the European Central Bank’s additional stimulus measures disappointed some investors.

Equities fell to their lowest level in almost three weeks as investors grapple with an array of influences, including divergent policies from major central banks, uneven economic data and turbulence in commodities markets. Energy shares slid Thursday for a second session, despite a rebound in oil prices, and health-care companies tumbled for the third time in four days.

The S&P 500 fell 1.4 percent to 2,049.78 at 4 p.m. in New York, following a 1.1 percent slide yesterday. The gauge sank below its average price during the past 200 days for the first time in three weeks. A measure volatility saw its biggest jump in two months.

Source: Bloomberg

U.S. Stocks Decline Amid Yellen Testimony, ECB Stimulus Moves

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U.S. stocks declined as Federal Reserve Chair Janet Yellen signaled the economy is nearly ready for higher borrowing costs, while the scale of the European Central Bank’s additional stimulus measures disappointed some investors.

Equities fell to a two-week low and are headed toward year end with their smallest move in four years. Investors are grappling with an array of influences, including divergent policies from major central banks, uneven economic data and turbulence in commodities markets. Energy shares weighed Thursday for a second session, despite a rebound in oil prices.

The Standard & Poor’s 500 Index fell 0.8 percent to 2,063.80 at 12:47 p.m. in New York, following a 1.1 percent slide yesterday. The Dow Jones Industrial Average lost 112.84 points, or 0.6 percent, to 17,616.84. The Nasdaq Composite Index declined 0.9 percent.

Yellen delivered a cautiously upbeat outlook for the U.S. economy, signaling the conditions necessary for an interest-rate increase have been met and that she hopes to tighten monetary policy slowly after liftoff. “I currently judge that U.S. economic growth is likely to be sufficient over the next year or two to result in further improvement in the labor market,” Yellen said, according to the text of testimony Thursday before Congress’s Joint Economic Committee.

Source : Bloomberg

Europe Stocks Slump Most Since August as Draghi Fails to Impress

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European equities tumbled the most since the August selloff as the additional stimulus measures unveiled by the region’s central bank underwhelmed investors.

The Stoxx Europe 600 Index lost 3.1 percent at the close of trading in London, reversing a gain of 0.9 percent. The European Central Bank lowered its deposit rate, and President Mario Draghi said it will extend its quantitative-easing program until at least March 2017, including debt issued by regional and local governments. It didn’t, however, expand its monthly asset purchases.

Heading into today’s meeting, investors had high expectations. The Stoxx 600 climbed 13 percent from its low in September through yesterday, including its best two-day rally since July after Draghi signaled in October that the central bank would consider additional measures. On Monday, the gauge closed at a three-month high, taking its valuation to 16.5 times estimated earnings -- closer to the multiple of 17.6 for the Standard & Poor’s 500 Index.

Traders were so confident that they saw little need to hedge: The number of Euro Stoxx 50 Index options changing hands last month was the lowest since July 2014. Contracts betting on further gains were the most owned.

After leading gains earlier on Thursday, carmakers were some of the biggest losers as the euro erased losses. Out of 600 companies in Europe’s stock gauge, 560 fell, with commodity producers slumping the most. Trading of Stoxx 600 companies was 36 percent greater than the 30-day average.

The central bank revised its inflation outlook, cutting it to 1 percent for 2016 and 1.6 percent for 2017, from 1.1 percent and 1.7 percent, respectively. It kept its prediction for next year’s economic growth at 1.7 percent and increased it to 1.9 percent for 2017, from 1.8 percent.

UBS Group AG said it kept its overweight rating on European stocks after today’s central-bank decision.

Source: Bloomberg

U.S. Stocks Fluctuate Amid ECB Moves Before Fed's Yellen Speaks

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U.S. stocks fluctuated before testimony from Federal Reserve Chair Janet Yellen on the economic outlook, while the scale of the European Central Bank’s additional stimulus measures disappointed some investors.

The Standard & Poor’s 500 Index rose 0.2 percent to 2,083.56 at 9:32 a.m. in New York, after falling 1.1 percent yesterday amid a plunge in oil prices. Equity futures earlier swung between gains and losses amid the ECB’s moves and comments from President Mario Draghi.

The ECB will extend its quantitative easing program until at least March 2017 and broaden the range of assets purchased while keeping the pace of monthly purchases steady at 60 billion euros ($65 billion), Draghi said. The bank’s 25-member Governing Council cut its deposit rate to minus 0.3 percent, in line forecasts by economists in a Bloomberg survey. Policy makers left the main refinancing rate and the marginal lending rate unchanged.

Draghi had been preparing markets for further stimulus since October, prompting economists surveyed by Bloomberg to unanimously predict the central bank would boost its efforts this week.

Investors also await testimony from Fed Chair Janet Yellen on the economic outlook. Yellen will appear before the congressional Joint Economic Committee at 10 a.m. in Washington, delivering a prepared statement and responding to questions from members. Yellen in a speech yesterday signaled confidence in the outlook, laying the groundwork for a December interest-rate increase. Traders are pricing in 76 percent odds the Fed will raise rates at the conclusion of its next meeting on Dec. 16.

A report today showed applications for unemployment benefits rose last week, maintaining a see-saw pattern around four-decade lows that shows persistent strength in the labor market. In addition to the claims data, investors will get other clues on the health of the economy today. Factory orders for October probably increased, while a gauge for the services industry slipped, economists forecast.

Source : Bloomberg