US equities post mixed weekly results amid geopolitical risks

NEW YORK (Xinhua) – United States (US) equities posted mixed results in the week ending January 3 as geopolitical risks loom.

For the week, the Dow lost less than 0.1 per cent, S&P 500 declined 0.2 per cent, and the Nasdaq gained 0.2 per cent.

Iran’s top leader Ayatollah Ali Khamenei vowed “tough revenge” after the US killed Commander of Iran’s Islamic Revolution Guards Corps Quds Force Major General Qassem Soleimani in an airstrike in Baghdad last Friday, Iranian state TV reported.

As a result of rising concerns over an energy shock, crude oil prices rose more than two per cent.

Shares of airlines declined on concerns over spiking oil prices. The stock prices of American Airlines, United Airlines, Delta Air Lines erased 4.95 per cent, 2.05 per cent and 1.66 per cent, respectively, last Friday.

“Geopolitical events by their nature are unpredictable, but previous periods of increased tensions suggest that the impact on wider markets tends to be short-lived, with more lasting effects confined to local markets and assets that are directly impacted by the tensions,” said Chief Investment Officer at UBS Global Wealth Management Mark Haefele, in a note last Friday.

Blue Ridge executives and guests at the New York Stock Exchange. PHOTO: AP

On the economic front, the number of Americans filing claims for jobless benefits edged lower last week.

The advance figure for seasonally adjusted initial claims was 222,000, a decrease of 2,000 from the previous week’s revised level, the US Labour Department said last Thursday. The number came lower than Wall Street’s expectations.

The previous week’s level was revised up by 2,000 from 222,000 to 224,000. The four-week moving average was 233,250, an increase of 4,750 from the previous week’s revised average.

US consumer confidence decreased to 126.5 last December from 126.8 in November last year, according to a report released by The Conference Board, a New York-based member-driven economic think tank, last Tuesday.

Director of Economic Indicators at The Conference Board Lynn Franco said while consumers’ assessment of current conditions improved, their expectations declined, driven primarily by a softening in their short-term outlook regarding jobs and financial prospects.

“While the economy hasn’t shown signs of further weakening, there is little to suggest that growth, and in particular consumer spending, will gain momentum in early 2020,” Franco said in a press release.

Earlier in the week, investors’ sentiment was lifted by easing tensions over US-China trade relations after the two countries agreed on the text of a phase-one trade deal last month.