Dow eyes record as end to US govt shutdown nears; Nasdaq still wobbly

Stocks on Wall Street were mixed as the Dow Jones Industrial Average climbed into record territory amid optimism about the prospect of the US federal government shutdown working its way to an end, with insurer UnitedHealth Group and Goldman Sachs leading the blue-chip index higher, while the tech-heavy Nasdaq Composite was on the red side of the ledger, with all of the Magnificent 7 megacap stocks declining.

Brent crude oil prices fell as the Organization of the Petroleum Exporting Countries kept its forecast for demand unchanged while its members prepare to ramp up production, weighing on big oil companies such as Chevron, which was the weakest firm on the Dow.

Chipmaker Advanced Micro Devices climbed after outlining plans to grab more of the market and nuclear energy startup Oklo rallied as investors shrugged off a deeper loss than expected, while stablecoin issuer Circle Internet Group tumbled with some nervousness about its expenses.

Australian futures are pointing to a positive start to the day for the ASX, while investors will be keeping close tabs on Infratil’s earnings, with reports coming across the Tasman that the sale of its Qscan investment will be pushed to next year.

The great reopening

Stocks on Wall Street were mixed with the blue chip Dow Jones Industrial Average up 0.9% at 7am in Auckland with investors hopeful the US federal government shutdown will come to an end today, which will free up the release of official economic data. The Federal Reserve has been relying on private datasets in the absence of official figures.

“The end of the US government shutdown is imminent later today, when House lawmakers vote on a bill that has already been approved by the Senate and President Trump,” Bank of New Zealand senior markets strategist Jason Wong said in a note. “There will be some delays in reopening over coming days so the economic hit will endure a little longer, before activity bounces back.”

The kiwi dollar traded at 56.64 US cents at 7am in Auckland from 56.53 cents yesterday.

The Dow was led higher by UnitedHealth Group and Goldman Sachs, while Cisco Systems gained ahead of reporting quarterly earnings after the closing bell.

Meanwhile, the tech-heavy Nasdaq Composite dipped 0.3%, with investors continuing to question the lofty valuations driven by the burgeoning artificial intelligence sector. Meta Platforms dropped 2% and Tesla was down 2.1% with all of the Magnificent 7 megacap stocks on the red side of the ledger today.

Energy major Chevron was the weakest company on the Dow, falling 2% in late trading, after OPEC kept its demand forecast unchanged ahead of planned production hikes by its members. Brent crude oil futures fell 2.4% to US$62.75 a barrel at 7am in Auckland.

Don’t stop believing

Advanced Micro Devices jumped 8% after the chipmaker outlined plans to grab market share, which it anticipates will drive annual sales growth of 80% in the coming years, while nuclear energy startup Oklo climbed 8% after posting a bigger loss than analysts expected as it ramped up research and development spending.

Circle Internet sank 9.4% after revenue growth beat expectations, with some nervousness about the stablecoin issuer’s expenses climbing at a faster pace.

Stock markets were stronger across the Atlantic, with the UK’s FTSE 100 index up 0.1%, while Germany’s DAX 30 climbed 1.2%, led by energy giant RWE, and the CAC 40 gained 1% with Societe Generale and BNP Paribas leading the French index higher.

The positive tone is set to spread to the antipodes, with Australian futures pointing to a 0.3% gain for the S&P/ASX 200 index when trading opens across the Tasman, while the S&P/NZX 50 index hit a new all-time high on Wednesday.

Locally, Infratil’s earnings are the main corporate event, with the CDC data centres unit’s development progress and One New Zealand’s revenue growth on analysts’ radars.

Across the Tasman, The Australian’s DataRoom column reported Infratil is pushing the sale of its Qscan business out to next year, when it hopes to achieve a juicier price than what some potential buyers might’ve been willing to consider.

Heartland Group Holdings is holding its annual meeting in Ashburton today, while Chatham Rock Phosphate’s shareholders will have their annual meetup in Wellington this evening.

Local data include Statistics New Zealand’s electronic card spending for October and travel and migration figures for September.

Reporting by Paul McBeth. Image from Maria Oswalt on Unsplash.