Market update: Shower of good news push stocks to another record, the Pound rallies as May gives in

29 Nov

by Mihály Tatár

 

Good Morning!

 

  • Really nobody could complain about the newsflow on Tuesday: The US consumer confidence surged to a 17-year-high, Fed chairman nominee Jerome Powell gave a super-balanced-slightly-dovish introduction speech and the Senate budget committee advanced the tax bill without major resistance. Even the European news were positive, with the UK and the EU reaching a ’breakthrough’ (meaning, May gave in and will pay 55 billion euros, plus assumes another 50 billion euros in liabilities, in return of an interim trade deal). Needless to say, markets were happy, ignoring even a fresh North Korean ballistic missile test (SPX +0.98% to 2627 points, DAX +0.46%, FTSE +1.04%, Nikkei +0.49%, EURUSD 1.1840, GBPUSD 1.3380, EURPLN 4.2015, EURHUF 310.80). Bitcoin exploded to another record high (10 900 USD, ups, we are now in the classic ballistic phase), but the optimism somehow avoided Turkey, with the Lira crashing to near 4.00 against the Dollar and the stock exchange extending its drop to 20% from August in USD terms.

 

  • In a demonstration that strength is returning to the oil industry, Shell restored its all-cash dividend (for the first time in three years) and gave a go-ahead for a 25 billion USD share buyback plan. Unsurprisingly, the oil company rallied 3.6% on the news (+18% since August), but major oil companies still look very slow in the general stock bull market. (Not even fresh record highs? Please.)

 

  • Behind the scenes, intensive US-Russian efforts are underway to sell a Syrian settlement process to the Middle East, based on the ’de-escalation zones’ principle. Sergei Naryshkin, head of Russia’s SVR foregin intelligence agency just visited Jerusalem, basically trying to assure Israel on the project and avoid an Israeli military intervention to stop the Iranization of its Syrian border. In the meantime, Saudi Prince Miteb bin Abdullah was released after reaching a nice 1 billion USD settlement (he used to be the head of the powerful National Guard), and other detained billionares also seem to be getting close to a deal. (In contrast, there are no news about Prince Alwaleed – and many noted the silence of his supposed friends in the West. Basically only Bill Gates made an effort to look worried.)

 

Have a nice day,

Mihaly

 

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