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Global Market Wrap-Up - January 17, 2013

Thursday, January 17, 2013
By: 
Mark Hanna
U.S. stocks rallied on a combination of hopes for Bank of Japan easing early next week, a reduction in weekly jobless claims, and a jump in housing starts. A poor Philly Fed number was ignored. Talk that the GOP was looking to "kick the can" on the debt ceiling for a "short period" helped lift stocks to their biggest gains of the day mid afternoon before some late day selling. The S&P 500 and NASDAQ both gained 0.6%.
  • Jobless claims fell 37,000 to a seasonally adjusted 335,000, hitting a five-year low, according to the Labor Department. The four-week moving average declined to 359,250.
  • Housing starts jumped 12.1% to a 954,000-unit annual rate in December, accelerating to its fastest pace since June 2008, according to the Commerce Department.
  • The Philadelphia Fed’s manufacturing index went negative in January, slipping to -5.8 in January from +4.6 in December. Economists expected a +5.0 reading.
In government debt news:
  • The U.S. government’s net financial position worsened to a $16.1 trillion deficit in fiscal 2012 from $14.8 trillion the previous year, the Treasury Department said today in its annual assessment of the government’s assets and liabilities. Debt held by the public and accrued interest contributed $11.3 trillion to the deficit, up from $10.2 trillion in 2011, according to the report. The government budget deficit for the year ended in September 2012 was $1.09 trillion, the fourth-largest since World War II.
Crude oil prices rose 1.3%, to settle at $95.49 a barrel, a four-month high. Gold rose 0.45%, to settle at $1,690.80 an ounce while silver added 0.85% to $31.81.

The U.K.'s FTSE 100 index rose 0.5% to its highest closing level since May 2008. Germany's DAX rallied 0.6% and France's CAC-40 index advanced 1% to its highest close since July 2011.

China's Shanghai Composite Index dropped 1.1% while Japan's Nikkei added 0.1%. China will release Q4 GDP overnight:
  • China's gross domestic product is expected to rise 7.8% from a year earlier in the final quarter of 2012, up from 7.4% growth in the third quarter, according to the median forecast of 17 economists.