Market Update: US Markets Ends on Positive Note

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Market Update

The US markets ended on the positive note as Dow Jones Industrial Average managed to end at 25,461.70 on November 6, 2018 which implies that it witnessed the rise of 190.87 points or 0.76%. Yesterday, the markets were primarily helped by the robust momentum in the share price of Warren Buffett’s Berkshire Hathaway. This strong momentum has positively impacted the broader financial sector. The strong momentum in the Buffett’s conglomerate was witnessed because they have announced that they have bought their own shares for approximately $1 billion in August. However, unfavourable momentum was witnessed in the Nasdaq Composite because of the fall in Apple Inc. (NASDAQ: AAPL) and Amazon (NASDAQ: AMZN). The downward momentum in the Apple stock was witnessed because the market players are of the view that their iPhone sales are expected to get a hit moving forward. Since, the company has released its quarterly report, the stock has not been able to impress the market players and, as a result, witnessed substantial downward momentum. However, Amazon witnessed the negative impact because the US President stated that the administration has been looking in the antitrust violations which have been committed by Amazon.

US Waivers Helped Oil Markets

The oil markets have been dealing a lot because of the fears regarding sanctions on Iran. The United States has granted waivers to some of the countries and allowed them to continue to import oil from Iran. This decision has aided the oil markets and these markets were relieved. Earlier, there were expectations that the oil prices might witness a strong uptrend. The increase in oil prices has the potential to disrupt the emerging economies. However, the concerns for the supply shortages were also eased when Saudi Arabia decided that they would be raising the production levels if any shortages with respect to the supply side is seen. The oil traders might be in the dicey position regarding the movement of the oil prices as a result of sanctions, waivers.

Will Federal Reserve Go for Rate Hike?

The Federal Reserve is expected to raise the interest rates in the December 2018 meeting primarily because of the strong US economy as well as wage growth. With the increased rates, the currencies of the emerging economies would be suffering as the US dollar would witness an appreciation. Earlier the market participants were hoping that the Fed might not raise the rates because of the sell-off witnessed in the markets globally. However, now those hopes do not exist, and the market trackers are widely expecting a hike in December.

How Australian Markets Have Performed?

The Australian ended the session on the positive note as S&P/ASX200 stood at 5875.2 which implies that it rose 57.1 points or 1.0%. Incitec Pivot Limited (ASX: IPL) and Western Areas Limited (ASX: WSA) ended the session by advancing 4.478% and 4.219%, respectively. On the contrary, Appen Limited (ASX: APX) and Skycity Entertainment Group Limited (ASX: SKC) concluded the session by falling 2.612% and 2.286%, respectively. The Australian economy is still witnessing the slump in the housing markets and the economists are predicting that the fall would continue even in 2019. Tighter lending conditions have substantially impacted the lending capacity of the borrowers.

The shares of Corporate Travel Management Limited (ASX: CTD) went into a trading halt as the company underway the review of VGI’s 52-page report disclosed yesterday. In this report, hedge fund VGI Partners raises its short position on CTM.

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