Equities and the Economy:

• S&P and Nasdaq close at all-time highs.
• Three major indexes post first weekly gain in three weeks.

Although the equity markets closed early on Friday at 1 PM EST and trading was understandably very light, the three major U.S. indexes managed to all posted gains with the S&P 500 and Nasdaq closing at new record highs. The S&P rose 5 points to 2,602 closing above the 2,600 mark for the first time ever. The Nasdaq advanced 22 points finishing at 6,889. The Dow also closed higher, 32 points to 23,558, and less than ½% from its all-time high. All three main indexes posted their first weekly gain in 3 weeks. For the week, the S&P and Dow gained 0.9% while the Nasdaq posted a 1.6% rise. The Russell 2000, the gauge for small cap companies, also closed at a record high on Friday at 1,519.

Regarding economic data, The University of Michigan released its closely watched consumer sentiment index on Wednesday. The index dropped from 100.7 in October to 98.5 for November. That being said, sentiment is still at its highest level since 2004. Other data came from MarkitFlash showing its manufacturing purchasing managers index for manufacturing fell in November by 0.8 to 53.8 and the flash services index fell by 0.3. Both indexes remain above 50 indicating growth, but the latest data showed growth at its slowest pace in 4 months.

But what’s been a primary driver of the stock market is corporate earnings. Actual earnings are mostly coming in way better than analysts have been forecasting.

This holiday season is looking to be very good for retailers. Pre-sales data are pointing to a solid 18% y-o-y increase for November and consumer holiday spending may be as much as 4% higher than last year.

Things are starting out slowly around the world and we are too with the Dow up 8 points this morning.

Oil

• Prices close at 2½ year highs.
• Post weekly gain.

In an abbreviated session on Friday oil prices closed higher with WTI hitting 2½ year highs. WTI finished up 93¢, 1.64%, at $58.95 and at levels not seen since summer 2015. Brent added 31¢ settling at $63.86. For the week WTI gained 4% and Brent added 1.8%. WTI has posed three consecutive weekly gains and Brent 4. Although U.S. oil production has marched higher this year, crude inventories keep creeping lower with U.S. oil exports at record highs capturing market share from OPEC resulting from their production cuts. Regarding OPEC, the cartel meets Thursday to vote on extending the production cut agreement to the end of 2018. It’s widely expected the cut will be extended and its already built into the current price of oil. Russia will reluctantly also extend their production cap.

This morning WTI is beginning the week on its back foot being down 55¢ driven by Baker Hughes rig count report on Friday. The oil services company report showed oil directed rigs increased by 9 the previous week to 747. This was the first weekly gain since July.

Courtesy of MDA Information Systems LLC

Natural Gas

• Prices get clobbered.
• Dip short lived.

In a holiday shortened session on Friday the bears were everywhere. December natural gas closed down a bull-slaughtering 15.5¢ at $2.813. As is always the case in the winter, it was about the weather forecast which came in Friday morning showing a very warm next couple of weeks. Jumping ahead to today, that price dip is proving to be short-lived for natty is up 10.0¢ this morning on the 11-15 day forecast which has flipped showing below normal temperatures for the southern part of the country. As a heads up, the December Nymex contract expires for the month tomorrow.

On Wednesday the EIA released its weekly storage report a day early noting U.S. inventories fell by 46 Bcf the previous week. Last year for the same week we saw a 2 Bcf injection and the 5 year average is a 46 Bcf withdrawal.

Elsewhere

Handwriting. What does yours mean?

• If letters slant to the left: Indicates introspection and a lot of emotional control.
• If letter slant to the right: Reveals a person who’s outgoing, friendly, impulsive, and emotionally open.
• If letters are straight up and down: The sign of someone who’s ruled by the head, not the heart.
• Letters that slant in more than one direction: Indicates versatility and adaptability.
• An erratic slant: Usually means a lack of flexibility.
• Heavy pressure writing (like you can feel the rib made on the back of the paper): The writer is agitated.
• Moderate pressure (the writing is dark, but you can’t feel the rib on the other side of the paper): Shows ability to deal with stress.
• Light pressure: Indicates someone who seems to take life in stride.
• Tiny letters: Indicate the writer is has somewhat low self-esteem but is intelligent.
• Small letters: The hallmark of quiet, introspective types – they’re generally detail-oriented and have good concentration.
• Large letters: Sign of a confident, easygoing individual.
• Huge letters: Indicate someone who’s theatrical, usually loud, and needs to be the center of attention at all times.
• Wide letters (their width and height are about the same): The mark of someone who’s open and friendly.
• Narrow letters: Show someone who’s somewhat shy and inhibited but very self-disciplined.
• Letters that don’t touch: Indicate an impulsive, artistic, sometimes impractical free thinker.
• Some letters connecting: Means the writer’s personality blends logic and intuition.
• All letters making contact: The sign of someone who’s highly cautious.
• A curved first mark: Shows a person who’s traditional and plays by the rules.
• A straight beginning stroke: Reveals someone who’s rigid and doesn’t like being told what to do.
• A final stroke straight across: The writer is cautious.
• An end mark that curves up: Reveals generosity.
• Perfect penmanship: The hallmark of a communicative person.
• An indecipherable scrawl: Indicates a person who’s secretive, closed-up and likes to keep his thoughts to himself.

(I don’t know who or what organization to credit with the above)

The next Morning Energy Blog will be on Wednesday. I have meetings tomorrow morning.