Home Finance Yahoo Finance's market update: Dec. 6, 2018 – Yahoo Finance

Yahoo Finance's market update: Dec. 6, 2018 – Yahoo Finance

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<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Stocks sold off after the arrest of a Chinese telecommunications company executive muddled prospects of a U.S.-China trade resolution.” data-reactid=”15″>Stocks sold off after the arrest of a Chinese telecommunications company executive muddled prospects of a U.S.-China trade resolution.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="The S&P 500 (^GSPC) fell 1.5%, or 40.48 points, as of 12:32 p.m. ET. The Dow (^DJI) slid 1.92%, or 480.13 points, after losing as many as 784.85 points. The Nasdaq (^IXIC) fell 0.54%, or 38.41 points.” data-reactid=”16″>The S&P 500 (^GSPC) fell 1.5%, or 40.48 points, as of 12:32 p.m. ET. The Dow (^DJI) slid 1.92%, or 480.13 points, after losing as many as 784.85 points. The Nasdaq (^IXIC) fell 0.54%, or 38.41 points.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="U.S. equities received some respite on Wednesday with stock and bond markets closed to mark the funeral of former President George H.W. Bush. But Thursday saw stocks return to the steep selling that rattled markets on Tuesday, which had sent the Dow tumbling by nearly 800 points.” data-reactid=”17″>U.S. equities received some respite on Wednesday with stock and bond markets closed to mark the funeral of former President George H.W. Bush. But Thursday saw stocks return to the steep selling that rattled markets on Tuesday, which had sent the Dow tumbling by nearly 800 points.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="A plummet in equity futures preceded Thursday’s session, with S&P 500 futures falling about 1.8% on higher-than-average volume when futures trading reopened at 6 p.m. ET on Wednesday. The CME Group, an options and futures exchange operator, paused trading in short intervals to stem the decline in futures.” data-reactid=”18″>A plummet in equity futures preceded Thursday’s session, with S&P 500 futures falling about 1.8% on higher-than-average volume when futures trading reopened at 6 p.m. ET on Wednesday. The CME Group, an options and futures exchange operator, paused trading in short intervals to stem the decline in futures.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Some are speculating that the catalyst for the plunge came in the wake of reports of the arrest of Meng Wanzhou, the CFO of China’s Huawei Technologies and the daughter of the company’s founder. Meng was arrested in Vancouver, Canada and faces potential extradition to the U.S. for allegedly violating sanctions and conducting illegal dealings with Iran. The arrest took place Saturday – the same day that President Donald Trump and Chinese President Xi Jinping met at the G20 summit in Argentina – but was first reported by Canada’s Globe and Mail on Wednesday.” data-reactid=”19″>Some are speculating that the catalyst for the plunge came in the wake of reports of the arrest of Meng Wanzhou, the CFO of China’s Huawei Technologies and the daughter of the company’s founder. Meng was arrested in Vancouver, Canada and faces potential extradition to the U.S. for allegedly violating sanctions and conducting illegal dealings with Iran. The arrest took place Saturday – the same day that President Donald Trump and Chinese President Xi Jinping met at the G20 summit in Argentina – but was first reported by Canada’s Globe and Mail on Wednesday.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="The arrest throws a wrench in hopes of a speedy trade deal between the U.S. and China. The Chinese embassy in Canada came out sharply against the arrest, calling it a human rights violation. Analysts at Deutsche Bank now believe that the probability that the U.S. and China reach an agreement by March 1 has dropped to 30% from 40%.” data-reactid=”20″>The arrest throws a wrench in hopes of a speedy trade deal between the U.S. and China. The Chinese embassy in Canada came out sharply against the arrest, calling it a human rights violation. Analysts at Deutsche Bank now believe that the probability that the U.S. and China reach an agreement by March 1 has dropped to 30% from 40%.

“Public opinion in China will likely become more negative in respect to the trade war, and potentially against US companies,” Deutsche Bank analyst Zhiwei Zhang wrote in a note Thursday. “The trade talk has just been resumed at the G20 meeting; now its outlook has darkened.”

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Meanwhile, oil prices slid Thursday morning as oil ministers of OPEC gathered for a meeting in Vienna, Austria to discuss output. Attendees decided to delay a decision on production until after meeting with other producers on Friday. Saudi Energy Minister Khalid al-Fahlih previously signaled that the new round of production cuts may come in less-than-expected at a 1 million barrel per day reduction, versus the 1.2 million to 1.4 million barrel per day cut that markets had factored in.” data-reactid=”22″>Meanwhile, oil prices slid Thursday morning as oil ministers of OPEC gathered for a meeting in Vienna, Austria to discuss output. Attendees decided to delay a decision on production until after meeting with other producers on Friday. Saudi Energy Minister Khalid al-Fahlih previously signaled that the new round of production cuts may come in less-than-expected at a 1 million barrel per day reduction, versus the 1.2 million to 1.4 million barrel per day cut that markets had factored in.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="U.S. West Texas Intermediate crude prices (CL=F) slipped 3.4% to $51.09 per barrel as of 12:06 p.m. ET. Brent crude, the international benchmark, (BZ=F) slid 3.62% to $59.33 per barrel.” data-reactid=”23″>U.S. West Texas Intermediate crude prices (CL=F) slipped 3.4% to $51.09 per barrel as of 12:06 p.m. ET. Brent crude, the international benchmark, (BZ=F) slid 3.62% to $59.33 per barrel.

NEW YORK, Dec. 4, 2018 — Traders work at the New York Stock Exchange in New York, the United States, Dec. 3, 2018. U.S. stocks closed higher on Monday. The Dow Jones Industrial Average increased 287.97 points, or 1.13 percent, to 25,826.43. The S&P 500 increased 30.20 points, or 1.09 percent, to 2,790.37. The Nasdaq Composite Index was up 110.98 points, or 1.51 percent, to 7,441.51. (Xinhua/Wang Ying) (Xinhua/ via Getty Images)

STOCKS: Shares of Huawei Technologies suppliers fall following Meng Wanzhou’s arrest

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="The arrest of Meng Wanzhou rattled suppliers to the Chinese tech company, sending their shares tumbling. U.S. NeoPhotonics (NPTN), which carries 47% revenue exposure to Huawei Technologies, slumped 20% to $6.16 per share as of 9:38 a.m. ET. Taiwan Semiconductor Manufacturing Company (TSM) with 8% revenue exposure fell 3.61% to $36.09 per share. U.S. chipmakers also slid, with the iShares PHLX Semiconductor ETF (SOXX) lower by 2%.” data-reactid=”36″>The arrest of Meng Wanzhou rattled suppliers to the Chinese tech company, sending their shares tumbling. U.S. NeoPhotonics (NPTN), which carries 47% revenue exposure to Huawei Technologies, slumped 20% to $6.16 per share as of 9:38 a.m. ET. Taiwan Semiconductor Manufacturing Company (TSM) with 8% revenue exposure fell 3.61% to $36.09 per share. U.S. chipmakers also slid, with the iShares PHLX Semiconductor ETF (SOXX) lower by 2%.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Guggenheim Securities initiated coverage of Facebook (FB), Twitter (TWTR), Snap (SNAP) and Alphabet (GOOG, GOOGL). The firm gave Facebook a neutral recommendation and a price target of $150, or about 8.8% upside from the last close. Guggenheim rated both Twitter and Alphabet as Buy, with the firm asserting that the former’s efforts to clean up fake accounts will help increase usage and bring on advertisers. Guggenheim rated Snap as new Neutral with a price target of $6, or 3.4% lower than the last closing price.” data-reactid=”37″>Guggenheim Securities initiated coverage of Facebook (FB), Twitter (TWTR), Snap (SNAP) and Alphabet (GOOG, GOOGL). The firm gave Facebook a neutral recommendation and a price target of $150, or about 8.8% upside from the last close. Guggenheim rated both Twitter and Alphabet as Buy, with the firm asserting that the former’s efforts to clean up fake accounts will help increase usage and bring on advertisers. Guggenheim rated Snap as new Neutral with a price target of $6, or 3.4% lower than the last closing price.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Thor Industries (THOR), which makes recreational vehicles, reported quarterly net sales below consensus estimates, sending shares falling. Net sales came in at $1.76 billion for the fiscal first quarter of 2019, below estimates of $1.91 billion. Gross margin was narrower than expected at 11.8% versus 12.6%. The company noted that quarterly results were “significantly impacted by acquisition-related costs” that totaled $57.1 million. Shares of Thor fell 9.56% to $58.16 each as of 9:27 a.m. ET.” data-reactid=”42″>Thor Industries (THOR), which makes recreational vehicles, reported quarterly net sales below consensus estimates, sending shares falling. Net sales came in at $1.76 billion for the fiscal first quarter of 2019, below estimates of $1.91 billion. Gross margin was narrower than expected at 11.8% versus 12.6%. The company noted that quarterly results were “significantly impacted by acquisition-related costs” that totaled $57.1 million. Shares of Thor fell 9.56% to $58.16 each as of 9:27 a.m. ET.

<h2 class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="ECONOMY: U.S. trade deficit widens to a 10-year high ” data-reactid=”43″>ECONOMY: U.S. trade deficit widens to a 10-year high

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="The U.S. trade deficit jumped to a 10-year high in October, increasing 1.7% to $55 billion, the Commerce Department said in a report Thursday. The trade gap has widened for five consecutive months. Trade data for the total September trade deficit was upwardly revised to reflect a $54.6 billion trade deficit. The trade deficit with China, a focal point of U.S.-Sino tensions, jumped 7.1% to a record $43.1 billion in October, from $40.2 billion in September.  was mainly driven by a further plunge in exports to China, and suggests that net trade will once again be a drag on GDP growth in the fourth quarter.” data-reactid=”44″>The U.S. trade deficit jumped to a 10-year high in October, increasing 1.7% to $55 billion, the Commerce Department said in a report Thursday. The trade gap has widened for five consecutive months. Trade data for the total September trade deficit was upwardly revised to reflect a $54.6 billion trade deficit. The trade deficit with China, a focal point of U.S.-Sino tensions, jumped 7.1% to a record $43.1 billion in October, from $40.2 billion in September.  was mainly driven by a further plunge in exports to China, and suggests that net trade will once again be a drag on GDP growth in the fourth quarter.

Andrew Hunter, U.S. economist for Capital Economics, wrote in a note the widening deficit “was mainly driven by a further plunge in exports to China, and suggests that net trade will once again be a drag on GDP growth in the fourth quarter.”

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Factory orders decreased by 2.1% in October, the Commerce Department reported Thursday, versus consensus expectations of a 2% decrease, according to Bloomberg data. This reverses a 0.2% increase in factory orders in September. New orders for manufactured durable goods also fell in October for the third time in the last four months, down 4.3% versus expectations of a 2.4% decrease. Transportation led total durable goods orders lower, posting a 12% decrease. New orders for manufactured durable goods excluding transportation rose 0.2% in October.” data-reactid=”46″>Factory orders decreased by 2.1% in October, the Commerce Department reported Thursday, versus consensus expectations of a 2% decrease, according to Bloomberg data. This reverses a 0.2% increase in factory orders in September. New orders for manufactured durable goods also fell in October for the third time in the last four months, down 4.3% versus expectations of a 2.4% decrease. Transportation led total durable goods orders lower, posting a 12% decrease. New orders for manufactured durable goods excluding transportation rose 0.2% in October.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Initial jobless claims fell during the week ending November 24 but came in higher than consensus estimates, based on the Department of Labor’s latest weekly report. Initial unemployment claims fell by 4,000 to 231,000 for the week, while consensus expectations were for new claims to come in at 225,000. Continuing jobless claims, however, were lighter-than-expected at 1.631 million versus estimates of 1.69 million.” data-reactid=”47″>Initial jobless claims fell during the week ending November 24 but came in higher than consensus estimates, based on the Department of Labor’s latest weekly report. Initial unemployment claims fell by 4,000 to 231,000 for the week, while consensus expectations were for new claims to come in at 225,000. Continuing jobless claims, however, were lighter-than-expected at 1.631 million versus estimates of 1.69 million.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Nonfarm private sector employment grew by 179,000 jobs in November, according to the latest monthly report from ADP National Employment. This fell short of the 195,000 new jobs expected by economists polled by Bloomberg, and decreased from the month-priors addition of 225,000 new jobs.” data-reactid=”48″>Nonfarm private sector employment grew by 179,000 jobs in November, according to the latest monthly report from ADP National Employment. This fell short of the 195,000 new jobs expected by economists polled by Bloomberg, and decreased from the month-priors addition of 225,000 new jobs.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Nonfarm business labor productivity increased in-line with estimates, coming in at a pace of 2.3% in the third quarter of 2018, according to final data from the U.S. Bureau of Labor Statistics. This represented a 10-basis point increase from the previous preliminary estimate. Nonfarm unit labor costs increased 0.9% to represent a 3.1%-increase in hourly compensation and a 2.3% increase in labor productivity, falling slightly short of estimates of a 1% unit labor cost increase.” data-reactid=”49″>Nonfarm business labor productivity increased in-line with estimates, coming in at a pace of 2.3% in the third quarter of 2018, according to final data from the U.S. Bureau of Labor Statistics. This represented a 10-basis point increase from the previous preliminary estimate. Nonfarm unit labor costs increased 0.9% to represent a 3.1%-increase in hourly compensation and a 2.3% increase in labor productivity, falling slightly short of estimates of a 1% unit labor cost increase.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="This post is being updated. ” data-reactid=”50″>This post is being updated. 

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="” data-reactid=”51″>

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck” data-reactid=”52″>Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck

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