Stocks Pull Ahead, Natura Gas Surged 5%

Barry Adams
07 Nov, 2022
New York City

Stocks closed higher on Monday ahead of the Congressional elections on Tuesday. 

Tuesday's midterm elections may indicate a new balance of power in the U.S. Congress as the divided nation votes on several issues confronting voters including sky-high inflation and out of control defense spending.  

Despite decades of policy changes and different parties in control, the U.S. economy has struggled to generate more than two million net new jobs a year, barring the post-pandemic recovery.

The consumer price inflation data on Thursday are likely to show an increase of 0.7% on a monthly basis in October or about 8.1% on an annual basis.

Hotter-than-expected inflation data may provide another confirming signal to the Federal Reserve to continue its aggressive rate hike campaign at the next meeting.

Interest rates are likely to jump higher by at least 50 basis points at the next Fed's meeting on December 14th.

The S&P 500 index increased 0.96% to 3,806.80 and the Nasdaq Composite index added 0.6% to 10,564.52.

Natural gas prices soared on the hopes that colder-than-usual climate conditions in certain regions of the U.S. will support higher demand.

Crude oil fell 81 cents to $91.82 a barrel and natural gas advanced 71 cents to $7.10 a thermal unit.

The U.S. treasury yields advanced following higher energy prices.

The yield on 2-year Treasury notes rose to 4.73%, 10-year notes jumped to 4.22% and 30-year bonds increased to 4.33%.

 

U.S. Movers 

Berkshire Hathaway jumped more than 1% after the Warren Buffett controlled conglomerate reported a 20% increase in earnings in its latest quarter.

Apple Inc declined more than 1% after China imposed tighter restrictions in the city where many Apple products are manufactured by its Taiwan-based contractor Foxconn Technology Group.

Carvana plunged 16% to $7.35 on the worries that the online used-car retailer may face more difficult times ahead as higher interest rates may slowdown consumer spending.  

 

European Markets Advance 

European markets generally traded higher and the resource-heavy FTSE index declined. 

German industrial production unexpectedly increased 0.6% in September after falling revised 1.2% in August, according to Destatis Monday. 

The DAX index edged up 0.5% to 13,533.52, the CAC-40 index was nearly unchanged at 6,416.61 and the FTSE 100 index fell 0.5% to 7,299.99. 

The U.S. dollar faced pressure ahead of midterm Congressional elections on Tuesday  and consumer inflation data on Thursday. 

The euro inched up to $1.002 and the British pound edged higher to $1.156. 

 

Weak China's International Trade Data Dragged Sentiment In Asia  

Asian markets gained following Friday's global market advance but weak Chinese international trade data trimmed gains.  

China's imports and exports unexpectedly declined according to the data released by the General Administration of Customs. 

 October exports declined 0.3% and imports fell 0.7% from a year ago. 

Exports declined for the first time since 2020 and trade surplus rose to $85.15 billion. 

The Nikkei 225 index gained 1.2% to 27,527.64, the Hang Seng index added 2.7% to 16,595.91 and the Sensex index increased 0.4% to 61,185.15. 

The Japanese yen edged up to 147.67 and the Chinese renminbi held near 7.23 and the Indian rupee recovered to 81.80 against the U.S. dollar.