Daily Market Reports | Nov 29 2008
By Greg Peel
The Dow closed up 102 points or 1.2% while the S%P gained 1.0% and the Nasdaq 0.2%.
It was a half-day session on Wall Street being the Friday wedged between Thanksgiving and the weekend. As one might expect, the NYSE was a ghost town and volumes were hardly worth mentioning. History shows that this Friday is usually an up-day which suggests Monday might be a better indicator.
But we’ll take it. Friday’s trade represented five consecutive up-days and we haven’t seen that since July 2007. The indices are up around 10% for the week.
It was also “Black Friday”, but don’t panic – the “black” in this case refers to “in the black” in retail terms. Retailers unsurprisingly make a large percentage of their annual profits from Christmas sales and as such spend half the year building up inventory ready for the Christmas rush. Thanksgiving unofficially marks the beginning of the holiday season in the US (it’s Melbourne Cup day in party-friendly Australia) and the Friday thereafter is a popular day to hit the stores for Christmas shopping.
As such, Friday is the day retailers will often see their profits go “into the black” for the first time in the year and thereafter it’s all money to keep. Expectation this year is, however, that Black Friday will be more like Bleak Friday. All across the US the “Sale” signs are up ahead of Christmas rather than after it and huge discounts are only attracting tumbleweeds.
Hence Monday is the day the numbers are known from Friday’s shopping, which is why it is Monday, not Friday on Wall Street which tells a tale. But clearly the market is already expecting sales to be decidedly weak.
Commodities markets were quiet on Friday with oil up US39c to US$54.43/bbl and gold up US$3.30 to US$817.90/oz. The Aussie remains relatively steady at US$0.6538. In London base metals were mildly weaker with copper down 2%.
The SPI Overnight rose 15 points.
