Market Update: Dow Jones Witnessed Significant Increase on December 26, 2018

market update

It seems to be a good day for the US investors if they were tracking the Dow Jones Industrial Average yesterday. The Dow Jones Industrial Average ended the session at 22,878.45 which reflects the substantial rise of 1086.25 points or 4.98%. It can be assumed that the yesterday’s rally was a much-needed as the markets have been witnessing the downtrend which is also impacting the state of the global economy and also the investors’ behaviour. There were concerns related to the slowdown in the global economy primarily because of the trade environment. However, the Federal Reserve’s comments about the outlook for the interest rate hikes also negatively impacted the investors’ sentiments.

The market participants are assuming that the US economy might witness two rate hikes in 2019 while earlier the Fed has hinted about three hikes. Even though the Federal Reserve has hinted a reduction in the interest rate hikes, the market players were expecting more reductions. It is also important to note that Mr. Trump had opposed the rate hikes and despite this, the Fed raised the rate by 25 basis points in its December 2018 meeting.

Oil Markets to Remain Sensitive to Stock Market Movements

Moving forward, it would not be wrong to assume that the oil prices are expected to be sensitive to the stock market movements and a downtrend in the equities might negatively impact the oil prices as well. The oil prices witnessed the robust momentum when the US markets showcased strong bullish movement. This clearly signifies that the oil markets would continue to track the movements of the stock markets.

However, it can also be said that the worries about the global economic slowdown would continue to impact the oil prices moving forward. There are expectations that a slowdown might lead to a fall in the demand of oil which might, in turn, impact the oil prices in the times ahead. Hence, it can be said that the participants in the oil markets need to cautious about taking the decision regarding the oil price movements.

Australian Markets Ended Today’s Session in Green

With the rise in the Dow Jones Industrial Average yesterday, how can the Australian Markets be left behind? The Australian markets ended today’ session on the positive note. On December 27, 2018, ASX/S&P200 closed at 5597.2 which implies the rise of 103.4 points or 1.8%. The stocks like Ausdrill Limited (ASX: ASL) and Bellamy’s Australia Limited (ASX: BAL) ended the session by advancing 7.373% and 6.461%, respectively.

However, the stocks like Speedcast International Limited (ASX: SDA) and Healthscope Limited (ASX: HSO) ended the session on December 27, 2018 by falling 4.967% and 1.376%, respectively. Additionally, Alliance Mineral Assets Limited (ASX: A40) had made a request related to the suspension of its securities. Read the full news here. Consolidated Zinc Limited (ASX: CZL) had announced about its ownership in Plomosas mine which has been raised to 90%. Read the full news here.

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