US stocks once again ended in a mixed note on Thursday, 27 June 2019 as investors await the outcome of an upcoming meeting on trade policy between President Donald Trump and Chinese President Xi Jinping at Friday's G-20 meeting in Japan. An agreement between Trump and Xi at the G-20 summit on Friday or Saturday would avert the next round of tariffs on additional $300 billion worth of Chinese imports.
The S&P 500 index rose 11 points, or 0.38%, to 2,924 and the Nasdaq composite index rose 58 points, or 0.73% to 7,967 but the Dow Jones Industrial Average lost 10 points, or 0.04% to 26,526.
Shares of financial companies led the broad-based advance, while energy stocks capped additional gains. Bank stocks traded higher ahead of the Federal Reserve's stress-test results release, which is scheduled for later on Thursday.
Thursday's economic data included the weekly Initial and Continuing Claims report, the third estimate for first quarter GDP, and Pending Home Sales for May. The Department of Labor reported initial jobless claims for the week ending June 22 increased by 10,000 to 227,000 (consensus 219,000). Continuing claims for the week ending June 15 increased by 22,000 to 1.688 million. The key takeaway from the report is that there hasn't been any meaningful change in the four-week moving average for initial claims, which remains at an encouragingly low level.
The third estimate for Q1 GDP was left unchanged at 3.1%, as expected, although the contribution to that estimate was altered. The GDP Price Deflator was up 0.9% (consensus 0.8%) after it was indicated to be up 0.8% in the second estimate. The key takeaway from the report was the recognition that personal spending growth was revised down to 0.9% from 1.3% in the second estimate.
Separaely, Pending Home Sales increased 1.1% in May (consensus +1.0%). Today's reading follows an unrevised 1.5% decline in April.
Boeing fell 2.9% after the Federal Aviation Administration said on Wednesday that it has found an issue with the 737 Max that the manufacturer must address before it lifts the national grounding order.
Bullion prices ended lower at Comex on Thursday, 27 June 2019. Gold futures finished lower on Thursday, suffering back-to-back losses after the haven metal scored a nearly six-year high early in the week. The impending sideline meetings at the Group of 20 conference in Japan between U.S. President Donald Trump and his Chinese counterpart Xi Jinping held the attention of financial markets, which had been supportive for gold in recent sessions.
August gold edged down by $3.40, or 0.2%, to settle at $1,412 an ounce. Silver contract fell 8.1 cents, or 0.5%, to $15.294 an ounce
Expectations for lower interest rates among global central banks and geopolitical concerns centered on trade spats and tensions with Iran had been making gold a preferred investment this spring, especially as competing low-risk U.S. Treasury bond yields dropped. The yield on the 10-year note fell below 2% in recent sessions.
Crude oil prices ended modestly higher on Thursday, 27 June 2019 to notch a new multiweek high, as global markets awaited pivotal trade discussions out the Group of 20 leaders summit and watched simmering tensions between the U.S. and Iran that could pose a risk to global supplies. The move followed a roughly 3% price surge on Wednesday for U.S. prices, seen on data showing a weekly drop of nearly 13 million barrels in domestic crude supplies.
On Thursday, August West Texas Intermediate crude added 5 cents, or nearly 0.1%, to settle at $59.43 a barrel. Prices on the New York Mercantile Exchange logged another settlement at the highest for a front-month contract since 22 May 2019. International benchmark August Brent crude tacked on 6 cents, or about 0.1%, to end at a roughly one-month high of $66.55 a barrel, ahead of the contract's expiration at the end of Friday's session. It was up more than 3% for the month so far.
Tensions between the U.S. and Iran have grown after Iran shot down a U.S. surveillance drone over the Strait of Hormuz earlier this month.
Looking ahead, investors will receive the following data on Friday: Personal Income and Spending for May, the PCE Price Index for May, the Chicago PMI for June, and the University of Michigan Index of Consumer Sentiment for June.