Equity Market Insight from Nasdaq MID - December 28 2017

Thursday, December 28, 2017, 10:26 AM, EST

• NASDAQ Composite -0.00% Dow +0.17% S&P 500 +0.04% Russell 2000 -0.04%
• NASDAQ Advancers: 995 Decliners: 1086
• Today's Volume (100 day avg) -30.3%

The markets opened higher again today and the Dow is at record levels and only about 185 points away from the 25k mark. The sector view is mixed with Staples, Industrials, Materials and Healthcare down slightly while Tech and Financials leads on the upside with just 0.2% advances. The dollar is at its lowest since September 8 ^th , gold is higher, treasuries weaker and crude oil is off about 0.1%.

• Unemployment numbers released today again show a strong demand for labor in the United States. According the U.S. Department of Labor, reported Initial Jobless Claims were in-line for the week with 245,000 vs polled expectations of 240,000. Continuing Claims were slightly higher at 1.943 million vs expectations of 1.90 million. Initial jobless claims continue to linger near all-time lows, indicating that employers are having a hard time finding skilled labor.
• The US trade deficit rose more than expected to $69.7b in November, the highest level since March 2015. Exports rose 3% to this highest in three years while imports increased 2.7% to a record $206.4b.
• Crude oil inventory data reflects progress toward market balance with both API and DOE reporting declines in crude stocks of -6.0m and -4.6m barrels respectively. Both also report modest builds in gasoline and distillates. Crude oil was little changed with the data and still shows a 0.1% decline on the day,

Technical Take:

2017 has been a strong year for US equities with the benchmark S&P 500 index gaining 19.9% YTD with less than two sessions left in the year. While some are largely attributing this year's strong gains to the "Trump Bump" effect and the recent passage of tax reform, there is no question that global growth is deserving of some credit as well. The MSCI World Index (MXWO) has a near identical YTD gain of 20.1% and like the S&P 500 is having its best year since 2013. Both indices are within 0.5% from their all-time highs with no apparent signs of slowing down. January tends to be a volatile month for equities, up or down, and "dip buyers" would more than welcome a healthy correction which never occurred in 2017. One sign 2018 will be another good year for equities is the price action within the base metals, particularly copper. Copper is on pace for its 16th consecutive day in the green, is now approaching a four-year high, and its daily RSI has reached an extreme overbought reading of 76. Strong global growth particularly from emerging markets, potential supply side concerns, along with a weakening US dollar have combined to fuel copper's rise. A pullback can be expected over the near term given its current record advance, however the longer term technicals suggest future gains are in store, and more importantly signals global growth should continue.

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Nasdaq's Market Intelligence Desk (MID) Team includes:

Michael Sokoll, CFA is a Senior Managing Director on the Market Intelligence Desk (MID) at Nasdaq with over 25 years of equity market experience. In this role, he manages a team of professionals responsible for providing NASDAQ-listed companies with real-time trading analysis and objective market information.

Jeffrey LaRocque is a Director on the Market Intelligence Desk (MID) at Nasdaq, covering U.S. equities with over 10 years of experience having learned market structure while working on institutional trading desks and as a stock surveillance analyst. Jeff's diverse professional knowledge includes IPOs, Technical Analysis and Options Trading.

Steven Brown is a Managing Director on the Market Intelligence Desk (MID) at Nasdaq with over twenty years of experience in equities. With a focus on client retention he currently covers the Financial, Energy and Media sectors.

Christopher Dearborn is a Managing Director on the Market Intelligence Desk (MID) at Nasdaq. Chris has over two decades of equity market experience including floor and screen based trading, corporate access, IPOs and asset allocation. Chris is responsible for providing timely, accurate and objective market and trading-related information to Nasdaq-listed companies.

Annie O'Callaghan is Director on the Market Intelligence Desk (MID) at Nasdaq. Annie has worked for NASDAQ in a variety of roles including support of Nasdaq C-level management in client retention and customer service. Annie also served as a Sales Director in Nasdaq's Transactions Services business. Prior to joining Nasdaq, Annie worked at AX Trading, managing accounts for its Alternative Trading System and served on Credit Suisse's trading desk as an Electronic & Algorithmic Sales Trading Analyst.

Brian Joyce, CMT is a Director on the Market Intelligence Desk (MID) at Nasdaq. Before joining Nasdaq Brian spent 16 years as an institutional trader executing equity and options orders for both the buy side and sell side. He also provided trading ideas and wrote technical analysis commentary for an institutional research offering. Brian focuses on helping Nasdaq's Financial, Healthcare and Transportation companies, among others, understand the trading in their stock. Brian is a Chartered Market Technician (CMT).

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