In a week marked by cautious optimism, the Dow Jones Industrial Average closed marginally higher on Friday, extending its winning streak for the third consecutive week. The market sentiment was buoyed by prospects of a moderated slowdown in the U.S. economy, hinting at a potential soft landing. Speculation also swirled around the likelihood of the U.S. Federal Reserve implementing interest rate cuts in the first half of the coming year.
The Dow Jones concluded at 34,947.28 points, experiencing a slight uptick of 1.81 points or +0.01%. Meanwhile, the S&P500 closed at 4,514.02 points, recording a modest rise of 5.78 points or +0.13%. The Nasdaq index closed at 14,125.48 points, reflecting an increase of 11.81 points or +0.08%.
Crude oil futures witnessed a significant surge, climbing over 4% on Friday. The rebound in prices came after reaching a four-month low the day before. Investor confidence bolstered as they re-entered the market to purchase crude oil contracts, particularly to counter short sales. Moreover, the imposition of sanctions by the U.S. on Russian oil tankers further supported the market’s upward trend.
WTI crude futures soared by $2.99 or 4.1%, settling at $75.89 per barrel, while BRENT crude futures saw a similar rise, surging by $3.19 or 4.1%, and closing at $80.61 per barrel.
Contrastingly, gold contracts experienced a dip in prices on Friday following a sharp surge observed the day prior. Investors engaged in profit-taking activities, leading to a corrective downturn in prices.
Gold futures fell by $2.60 or 0.13%, reaching $1,984.70 per ounce at the close, although it managed to register a weekly increase of 2.1%. Silver also saw a decline of 8.10 cents or 0.34%, closing at $23.852 per ounce, while platinum futures dropped by $1.10 or 0.12%, settling at $901.70 per ounce. However, palladium futures moved in the opposite direction, rising by $9.30 or 0.89%, ending the day at $1,058.90 per ounce.
In the currency markets, the U.S. dollar faced a downturn against a basket of major currencies on Friday despite signals from Federal Reserve officials indicating openness to further rate hikes if deemed necessary. Robust data depicting a significant increase in home starts and building permits in the United States failed to provide support for the dollar.
The dollar index against a basket of six major currencies fell by 0.41% to 103.9219, marking a 1.60% decline for the week. The dollar weakened against the yen, Swiss franc, Canadian dollar, and Swedish krona, while the euro rose to $1.0899 from $1.0856, and the pound climbed to $1.2449 from $1.2416.
The week in the financial markets showcased a blend of positive cues from various sectors, with investors navigating through nuanced economic indicators and geopolitical developments, influencing diverse asset classes.