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DAILY MARKET REVIEW: 08 JANUARY 2015

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Daily Market Review on STOCK.com

DAILY MARKET REVIEW: 08 JANUARY 2015

Jan 08 2015, 08.38am GMT

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STOCK.com   Indices

In response to the neutral minutes of the December meeting of the Federal Reserve as well as the positive private-sector employment hiring data, U.S. stocks rebounded on Wednesday. This increase gave the S&P 500 index (SPX) its first gain in 2015 and also broke the index’s 5-day losing streak. According to Automatic Data Processing Inc. (ADP) data, companies increased their payrolls by 241,000 in December. This was above analysts’ forecast for an increase of only 225,000. Meanwhile, in their minutes, the Federal Reserve made it clear that they would not be deterred by low inflation and that interest rate hikes will take place. The Fed however, stated that this increase would not take place before April this year. As a result, at the close of U.S. trading, the SPX closed up 1.2%, at 2,025.90, while the Nasdaq Composite Index (COMP) also closed up 1.3% at 4,650.47. Also on the upside was the Dow Jones Industrial Average (DJIA) which advanced 1.2% to 17,584.52.

STOCK.com   Currencies

On Wednesday, the euro (EUR) continued to fall against the U.S. dollar (USD), slipping to fresh 9-year lows. The EUR/USD currency pair traded down 0.40% at 1.1842. This decline came in response to poor data which showed that in the euro area, the consumer prices fell in December. This marked the first decline in the last 5 years, since October 2009. On Tuesday, the Eurostat reported a decline of 0.2% in the annual rate of inflation in the eurozone in December. In November, it was at 0.3 percent. Meanwhile, the core inflation increased by 0.8 percent on a year-over-year basis however this was still below the target of the European Central Bank (ECB). As a result of this data, it is now expected that the ECB will implement new quantitative easing measures as soon as their next meeting which will take place on the 22nd of January.

STOCK.com   Stocks

With one search deal off the table and another big deal pending, investors are wondering if Google (GOOGL, -0.29%) can continue to hold on to its majority share of search traffic. After Yahoo (YHOO, -1.26%) was made the default search engine of the Firefox browser, a decline in Google’s U.S search traffic was seen from 77.5 percent in November, down to only 75.3 percent in December. This excludes mobile devices. At the same time, Yahoo saw an increase in their search traffic from 8% to 10 percent. In December, Firefox accounted for almost fourteen percent of U.S. browsers which marked a clear shift in browsing trends. Google is now facing additional losses amid reports that Apple (AAPL, +1.40%) is currently considering to drop Google as their default search provider on its Safari browser. This is currently the standard on the iPad and the iPhone. Almost 54 percent of mobile traffic in the U.S. came from Safari in December while only 41 percent came from browsers on Google including Chrome. With the new Apple deal on the horizon, the doors will now open allowing Microsoft and Yahoo to take a share of the search traffic. Google is currently trading at $501.10 per share.

STOCK.com   Commodities

On Thursday, the prices of crude oil rose in Asian trading. This positive move came in response to the neutral December meeting minutes by the Federal Reserve as well as a positive report on crude inventories in the U.S. Crude oil for February delivery rose to $48.75 a barrel, up 0.20 percent on the NYMEX. In its weekly report, the Energy Information Administration said that inventories of crude oil in the U.S. had declined by 3.1 million barrels in the week ending on the 2nd of January. This was positive against analyst expectations for an increase of 0.9 million barrels. As of last week, total U.S. crude oil inventories stood at 382.4 million barrels.

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