- The Dow’s best performer Apple surged almost 89% in 2019.
- The S&P 500 and Nasdaq each had their best annual performance since 2013
- Trump said phase 1 of China trade deal will be signed on Jan. 15.
U.S. stocks finished a strong 2019 on a positive note as apparent late day buying by traders pushed indexes higher on Tuesday.
The Dow Jones Industrial Average gained 74.06 points to 28,536.20 while the S&P 500 rose 9.25 points to 3,230.54 and the Nasdaq Composite Index added 26.62 points to 8,972.60. For the year, the Dow rose 23.33%, the S&P 500 jumped 28.86% and the Nasdaq surged 35.23%. For both the S&P 500 and Nasdaq, 2019 was their best annual performance since 2013.
The Dow’s best performing stock, Apple (AAPL), soared almost 89% in 2019.
Tuesday’s volume on the New York Stock Exchange totaled 2.53 billion shares with 1,862 issues advancing, 100 setting new highs, and 1,053 declining, with 9 setting new lows.
U.S. President Donald Trump tweeted Tuesday morning that the phase one trade deal with China will be signed on Jan. 15 at a ceremony at the White House. He said he will later fly to Beijing to begin talks on phase two.
I will be signing our very large and comprehensive Phase One Trade Deal with China on January 15. The ceremony will take place at the White House. High level representatives of China will be present. At a later date I will be going to Beijing where talks will begin on Phase Two!
— Donald J. Trump (@realDonaldTrump) December 31, 2019
White House trade adviser Peter Navarro told CNBC that the trade deal with China has “got great stuff in it. It’s got essentially the same chapter we had in the May deal that the Chinese walked away from on intellectual property theft. So that’s a good deal.”
Navarro also said in 2020, “we’re going to try to get something going with Great Britain, Vietnam, Europe and anybody else who wants to fairly trade with the United States of America.”
Navarro was also bullish on U.S. stock markets.
“It’s going to be the roaring 2020s next year,” he said. “[Dow at] 32,000 is a conservative estimate of where we’ll be at the end of the year.”
But some other forecasters were somewhat less bullish about the coming year.
Hannah Anderson, global market strategist, JPMorgan Asset Management, said in a note Tuesday that “politics has to remain front and center for investors” in 2020. “The U.S.-China trade war is far from resolved,” she added. “Returns will depend on just how tolerant investors can be of their fears in a low growth world.”
“By any objective measure U.S. large cap stocks start 2020 on perilous footing. Valuations are rich. Corporate debt levels are at record highs,” said Nicholas Colas, co-founder of DataTrek Research, in a note. “But we know the Federal Reserve has learned its lesson. It will be quick to ease if necessary and slow – very slow – to raise rates. Further, the U.S. economy is in good enough shape to limit voter appetite for dramatic changes to economic policy. All this should be enough to generate 5%-6% corporate earnings growth in the 2nd half of 2020. That’s when the easiest comps to 2019 appear; the 1st half is somewhat harder.”
The S&P CoreLogic Case-Shiller U.S. National Home Price Index rose 3.3% in October on an annual basis, slightly above the 3.2% increase reported in September.
The index measures average home prices in major metropolitan areas across the country.
“October’s U.S. housing data continue to be reassuring,” said Craig J. Lazzara, a managing director at S&P.
“With October’s 3.3% increase in the national composite index, home prices are currently more than 15% above the pre-financial crisis peak reached [in] July 2006.”
China’s Purchasing Managers’ Index for manufacturing came in at 50.2 for the month of December, just above expectations of 50.1. A reading above 50 indicates expansion. China has now seen two straight months of such expansion, after six months of contraction.
Overnight in Asia, markets were mixed. China’s Shanghai Composite gained 0.33% while Hong Kong’s Hang Seng fell 0.46%. Japan’s Nikkei-225 was closed for the holiday. For the year, the Hang Seng rose 9.07%, the Shanghai Composite surged 23.8% and the Nikkei jumped 20.93%.
In Europe markets traded lower, with Britain’s FTSE-100 down 0.59% and France’s CAC-40 off 0.07%. Germany’s DAX was closed for the holiday. For the year, the DAX surged 25.22%, the FTSE gained 12.1% and CAC soared 26.36%.
Crude oil futures fell 0.81% at $61.18 per barrel and Brent crude rose 0.05% at $66.03. Gold futures gained 0.13%.
The euro gained 0.12% at $1.1215 while the pound sterling rose 1.01% at $1.3245.
The yield on the 10-year Treasury rose 1.27% to 1.919% while yield on the 30-year Treasury gained 1.96% to 2.389%.
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