Spreadex Market Update
Typically messy 2016 afternoon as Brent Crude rises on Saudi Arabia/Russia rumours
Despite a far worse than expected core durable goods order (coming in at -1.2% against the -0.1% forecast) and a solid, if unspectacular, jobless claims number, the Dow Jones managed to open around 100 points higher this Thursday, jumping past the 16000 level it abandoned yesterday. It appears that the main thrust of the afternoon’s gains is oil-related. Rumours of an agreement between Saudi Arabia and Russia, and agreement that would lead to a 5% cut to their output caused Brent Crude to surge over 6%, briefly crossing the $35 per barrel mark in the process. A lack of confirmation means Brent’s bounce may not last until closing time, but for now it is brightening up what could have been a pretty dour open.
Oddly the FTSE failed to really benefit from the latest twist in the oil saga. The UK index has flailed about for much of the day, only just recovering from its lunch-time losses to start the US session flat. The Eurozone was a whole different story; plunging nearly 1.5% the DAX got a taste of the dramatic today, struggling in the face of Germany’s weak inflation and import prices figures. This helped drag the CAC with it, though the French index was slightly less hysterical, tumbling around 35 points as the day wore on.
Beyond the macro-movements Facebook was the day’s real winner. Surging by 13%, the company cemented its unparalleled position in the social media landscape last night with its fourth quarter results. A 17% in daily active users to 1.04 billion was joined by a 51.7% rise in revenue to $5.8 billion and a $900 million jump in profit to $1.6 billion year-on-year. It’s an astonishing set of results that puts even further distance between the big blue monster and its ostensible rival Twitter, with investors seemingly desperate to become Facebook’s friend.
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