Tuesday, December 18, 2012
U.S. stocks rallied for the second day on the same fiscal cliff resolution hopes; the S&P 500 added 1.15% and the NASDAQ 1.5%. To repeat yesterday's comments, at this point the market just wants a resolution, and is not concerned with the details of the resolution which will include higher taxes and lower federal spending - both near term drags on the economy.
- U.S. home builders' confidence rose for the eighth-straight month in December, reaching its highest level in 6½ years, according to The National Association of Home Builders.
- The U.S. current-account deficit fell to its lowest level since 2010 in the third quarter. The measure, a broad gauge of international transactions, narrowed slightly less than expected. Imports fell for the second quarter and exports held steady.
The U.S. dollar continued to suffer, falling to its lowest level in two months. Crude oil gained 0.8% to $87.93, gold fell 1.6% to $1670.70, and silver dropped 1.9% to $31.67.
Britain gained 0.4%, Germany 0.6%, and France 0.3%.
- Standard & Poor's rating agency said at midday that it had raised Greece's credit grade by six notches to B-. The ratings firm said the upgrade reflected its view that the other 16 countries using the euro are determined to keep the Greece inside the currency union.
Japan's Nikkei Stock Average gained 1% to finish at an 8½-month high. China's Shanghai Composite tacked on 0.1%, reaching a four-month high.
- Japan's new prime minister Shinzo Abe is demanding the Bank of Japan change its inflation target from 1% to 2% and wants the bank to begin "unlimited" monetary easing.