Trade War, Fed Statement and Crude Oil – Here’s what’s moving the markets right now…

Stock Market Update Sunday, June 23rd, 2019

What a week!

On Monday, stocks were slightly higher after trading in the smallest range of the year.

Then on Tuesday, stocks were on the move after President Trump said he had a “very good call” with President Xi of China.

Then Wednesday came and it was all about the Fed.

Stocks were quiet ahead of the Fed Statement and Press Conference, then rallied and finished the day slightly higher. All things considered, it was a very uneventful Fed day. And there wasn’t a lot of movement.

But then on Thursday stocks rocketed higher and the S&P made a new record high.

On Friday, stocks were higher in the morning but finished the day slightly lower.

Here’s what traders were focused on:

  • The Fed – This week the big event was the Fed Statement on Wednesday. Weaker employment numbers and the belief that the Fed is ready to cut rates helped fuel the latest rally. The Fed removed the word “patient” from their statement and their dot plot projection shows that 8 voting members support a cut this year. So the Fed didn’t come right out and say that they WILL cut rates, but traders seemed to think that there is a lot to read between the lines. The day after the statement the S&P made record highs, and according to the CME FedWatch tool, traders believe that there is a 100% chance that the Fed will cut rates in July.
  • Record Highs – The S&P rallied to record highs and closed with a new record on Thursday. On Friday, the S&P jumped to record highs but finished with its 2nd highest close on record. The DOW finished the week 0.9% below its record after coming within 0.2% of its record on Friday. The NASDAQ lags behind the indices and is still 1.8% away from its record.

Here’s where the major indices ended the week:

  • The S&P finished with a 2.2% gain. Up 63 points, the S&P ended at 2,950.
  • The DOW ended higher by 2.4%. Adding 630 points, the DOW closed at 26,719.
  • The NASDAQ was up 3.0%. With a 235 point gain, the NASDAQ finished at 8,032.

Crude Oil (CL) jumped on concerns in the Middle East and finished the week with its highest close in over 3 weeks. With an 8.8% gain, CL ended at $57.38 a barrel.

Tensions in the Middle East came after the U.S. accused Iran of shooting down a U.S. drone in international airspace in the gulf. President Trump said that Iran made a “very big mistake” and ordered a retaliatory attack on Iran but scrapped plans 10 minutes before the attack.

Energy stocks got a nice boost with the rally in oil.

Exxon Mobil (XOM) jumped 4.5% and Chevron (CVX) finished higher by 3.4%.

Bitcoin continues to move higher, jumping 19.1% last week. On Friday, Bitcoin closed at 10,095. This is the first close above 10,000 since March of 2018.

This week traders will be focused on trade, and talks between the U.S. and China. President Trump and President Xi Jinping are set to speak during the G-20 summit in Japan. 

Here is the economic calendar for the week:

Real Time Economic Calendar provided by Investing.com.

This Stock Market Update was provided by Rockwell Trading Services LLC.

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