Advertisement
Advertisement

Stocks Steady Ahead of Trump’s Inauguration

By:
James Hyerczyk
Updated: Jan 20, 2017, 17:37 UTC

U.S. stocks were trading higher shortly before the inauguration of President Donald Trump. This may be an indication that investors are willing to give

Donald_Trump 5

U.S. stocks were trading higher shortly before the inauguration of President Donald Trump. This may be an indication that investors are willing to give Trump the benefit of the doubt when it comes to his policies at least over the short-term. Recently, he took heat because he has not yet revealed the details of this economic plans which include aggressive fiscal spending, relaxed regulations and tax cuts.

As customary, many investors feel that stock market investors will give the President at least the first 100 days in office to right his ship and steer his administration on the right path.

There were no major economic reports on Friday with all eyes on Trump’s inauguration and his speech which follows. Philadelphia Federal Reserve President Patrick Harker said in a speech the U.S. labor participation rate is lower than he would like, and is holding down productivity and growth.

In earnings news, Dow components General Electric and Procter & Gamble both reported quarterly results. GE’s adjusted earnings per share came out in-line with expectations while revenue came in slightly below forecasts. P&G’s earnings topped estimates on both the top and bottom lines.

Crude Oil

Crude oil prices moved higher on Friday as investors looked ahead to a weekend meeting between OPEC/non-OPEC producers that is expected to reveal for the first time compliance with its program to reduce output, trim the global supply and stabilize prices.

Although optimism ahead of the meeting is helping to support prices, gains were capped as U.S. crude inventories rose unexpectedly the week-ending January 13 as refineries sharply slowed production. Additionally, a surge in gasoline stocks amid weak demand could also put a cap on prices.

Other bearish news included increasing production from Libya. According to sources, Libya’s National Oil Corporation (NCO) said production had now climbed to 722,000 barrels per day.

Gold

Stock investors hedged their bets in the gold market on Friday as investors went into the inauguration of Trump with some apprehension over his ability to run a government and enact his policies. Traders will have to decide by the tone of Trump’s inauguration speech whether they need to continue to hold on to gold as a safe haven investment.

Forex

While trading was active in stocks and gold, investors failed to pick a side in the U.S. Dollar. The Greenback was little changed going into Trump’s speech, suggesting trader indecision and that perhaps investors were going to take a wait-and-see approach while Trump transitions into office.

About the Author

James is a Florida-based technical analyst, market researcher, educator and trader with 35+ years of experience. He is an expert in the area of patterns, price and time analysis as it applies to futures, Forex, and stocks.

Did you find this article useful?

Advertisement