The American stock markets opened lower but reversed course to close in positive territory. Tuesday’s trading was dominated by news from Ukraine, where Ukraine attacked Russian territory with American long-range missiles, prompting Russia to ease its nuclear doctrine demands. This escalation led to a rise in defense stocks, while investors sought safety in assets like gold. Additionally, the healthcare sector was weighed down as President Donald Trump appointed Robert F. Kennedy, a well-known vaccine skeptic, as health minister.
In individual stock movements, Super Micro Computer saw significant fluctuations as Ernst & Young dropped out as its auditing firm, causing its stock to plummet. However, BDO USA taking over as the new auditor led to a surge of over 30 percent in the stock price. The broad S&P 500 index rose by 0.4 percent, the industrial Dow Jones index traded down by 0.3 percent, and the tech-heavy Nasdaq surged by 1.0 percent.
Commodities saw widespread gains, with oil registering modest increases after partial restoration of oil production at the Norwegian Johan Sverdrup field following Monday’s power outage. The strengthening U.S. dollar, currently at a one-year high, made commodities more expensive for buyers using other currencies. WTI crude oil rose by 0.2 dollars to $69.3 per barrel, while Brent crude traded up by 0.1 dollar to $73.4 per barrel.
Base metals experienced overall gains, with aluminum leading the pack with a 1.3 percent increase, followed by nickel at 0.5 percent, and copper and lead both rising by 0.3 percent. Gold continued its upward trajectory due to heightened geopolitical tensions in Ukraine, increasing demand for the safe-haven metal. The Federal Reserve is also expected to cut interest rates by 25 basis points in December, making gold an attractive investment in a low-interest environment. Gold rose by $17.8 to $2,629.3 per ounce.
In the U.S. stock market, Walmart saw a 3.0 percent increase after beating third-quarter sales and earnings per share expectations, while Nvidia surged by 4.9 percent ahead of its quarterly earnings report. SMCI also jumped by 31.3 percent after appointing BDO USA as its new auditor and presenting a plan to Nasdaq to avoid delisting. Vaccine manufacturer Biontech ended the day up by 6.4 percent, and electric car maker Tesla rose by 2.1 percent, while tax advisory firms H&R Block and Intuit declined by 8.2 and 5.1 percent, respectively.
The U.S. ten-year Treasury bond fell by 1 basis point to 4.40 percent. In Asia, markets started the day with mixed trading, with Japan reporting its trade balance and exports, and China maintaining its lending rates. Investors worldwide are awaiting Nvidia’s quarterly report, which is expected to influence the entire market and drive sentiment in the tech sector for the rest of the year.
On the Stockholm Stock Exchange, the reporting calendar is quiet on Wednesday, with Eolus Vind, Mysafety, and Soltech Energy scheduled to release reports later in the day. Notable recommendations include UBS upgrading Astra Zeneca from sell to neutral with a target price of 1,567 SEK, and RBC raising Bioarctic’s target price to 340 SEK while reiterating an outperform rating. Morgan Stanley lowered its target price for Getinge to 194 SEK and maintained a neutral recommendation, while Carnegie reduced its target price for Synsam to 59 SEK while reiterating a buy rating.
On the macroeconomic front, Wednesday is a relatively calm day, with key economic data releases in Japan, China, the UK, and Germany. Notable speeches include European Central Bank President Lagarde, Bank of England member Ramsden, Fed member Cook, and FOMC member Barkin. The day will conclude in the U.S. with the Energy Information Administration’s weekly crude oil inventory report.
Overall, the global markets are navigating geopolitical tensions, economic data releases, and corporate earnings reports, shaping investor sentiment and market movements. The interplay of these factors will continue to influence trading activity and asset valuations in the near term. Stay tuned for further updates and insights into the dynamic landscape of the financial markets.