By Georgina McCartney

HOUSTON (Reuters) -Oil prices rose for a third consecutive day on Wednesday, boosted by a larger-than-expected fall in U.S. fuel stocks, and rising tensions in the Middle East.

Brent crude futures settled 62 cents higher, or 0.79% at $79.21 a barrel as of 2:40 pm ET (1940 GMT). U.S. West Texas Intermediate crude climbed 55 cents, or 0.75% to $73.86.

U.S. gasoline stocks fell by 3.15 million barrels last week compared with analysts’ estimates for a build of 140,000 barrels, according to the U.S. Energy Information Administration (EIA). Distillate stocks fell 3.2 million barrels, compared with estimates for a 1 million barrel draw.

Crude stocks, however, posted a larger-than-expected build of 5.5 million barrels as production recovered after a cold snap, while U.S. refiners stepped up maintenance. Analysts had estimated a smaller build of 1.9 million barrels.

“This is the kind of report you would expect out of the post freeze-in with refineries not in any hurry to come back,” Bob Yawger, director of energy futures at Mizuho Bank.

Refinery utilization shrank 0.5% to 82.4%. On the U.S. Gulf Coast, the deep freeze knocked off 15% of refining capacity, pressuring utilization rates to their lowest level since September 2021, according to EIA data.

On the supply side, the EIA cut its 2024 outlook for domestic oil output growth on Tuesday, putting it far lower than the 2023 increase and predicting it would not reach December 2023’s record levels until February 2025.

As ever, the market is keeping an eye on developments in the Middle East.

Israeli Prime Minister Benjamin Netanyahu said total victory in Gaza was within reach, rejecting the latest offer from Hamas for a ceasefire to ensure the return of hostages still held in the besieged enclave.

The remarks dismissing the latest offer by Hamas for a ceasefire in Gaza show he intends to pursue conflict in the Middle East, senior Hamas official Sami Abu Zuhri told Reuters.

Traders are also tracking the Iranian-backed Houthi rebels’ attacks on shipping in the Red Sea that have disrupted traffic through the Suez Canal, the fastest sea route between Asia and Europe and one that carries nearly 12% of global trade.

Elsewhere, Federal Reserve Bank of Boston President Susan Collins said if the economy met her expectations the central bank will likely be able to lower rates at some point later this year, potentially lending support to crude futures.

“There is confusion in the markets from mixed signals out of the Federal Reserve … they are now waiting too long to ease, adding an additional element of risk back into the market,” said Timothy Snyder, economist at Matador.

In the longer term, the International Energy Agency (IEA) said India is expected to be the largest driver of global oil demand growth between 2023 and 2030, narrowly taking the lead from top importer China.

That comes as struggling large economies, including China’s, dent confidence in the global oil demand outlook.

(Reporting by Paul Carsten in London and Arathy Somasekhar and Georgina McCartney in Houston and Muyu Xu; Editing by Paul, Christian Schmollinger, Louise Heavens, David Evans, Barbara Lewis, Nick Macfie, David Ljunggren and David Gregorio)

By Georgina McCartney

HOUSTON (Reuters) -Oil prices rose for a third consecutive day on Wednesday, boosted by a larger-than-expected fall in U.S. fuel stocks, and amid rising tensions in the Middle East.

Brent crude futures gained 48 cents to $79.07 a barrel as of 1:35 pm ET (1835 GMT), while U.S. West Texas Intermediate crude climbed 42 cents to $73.73.

U.S. gasoline stocks fell by 3.15 million barrels last week compared with analysts’ estimates for a build of 140,000 barrels, according to the U.S. Energy Information Administration (EIA). Distillate stocks fell 3.2 million barrels, compared with estimates for a 1 million barrel draw.

Crude stocks, however, posted a larger-than-expected build of 5.5 million barrels as production recovered after a cold snap, while U.S. refiners stepped up maintenance. Analysts had estimated a smaller build of 1.9 million barrels.

“This is the kind of report you would expect out of the post freeze-in with refineries not in any hurry to come back,” Bob Yawger, director of energy futures at Mizuho Bank.

Refinery utilization shrank 0.5% to 82.4%. On the U.S. Gulf Coast, the deep freeze knocked off 15% of refining capacity, pressuring utilization rates to their lowest level since September 2021, according to EIA data.

On the supply side, the EIA cut its 2024 outlook for domestic oil output growth on Tuesday, putting it far lower than the 2023 increase and predicting it would not reach December 2023’s record levels until February 2025.

As ever, the market is keeping an eye on developments in the Middle East. Israeli Prime Minister Benjamin Netanyahu said total victory in Gaza was within reach, rejecting the latest offer from Hamas for a ceasefire and renewed a pledge to destroy the Palestinian Islamist movement.

Traders are also tracking the Iranian-backed Houthi rebels’ attacks on shipping in the Red Sea that have disrupted traffic through the Suez Canal, the fastest sea route between Asia and Europe and one that carries nearly 12% of global trade.

Elsewhere, Federal Reserve Bank of Boston President Susan Collins said if the economy met her expectations the central bank will likely be able to lower rates at some point later this year, potentially lending support to crude futures.

“There is confusion in the markets from mixed signals out of the Federal Reserve … they are now waiting too long to ease, adding an additional element of risk back into the market,” said Timothy Snyder, economist at Matador.

In the longer term, the International Energy Agency (IEA) said India is expected to be the largest driver of global oil demand growth between 2023 and 2030, narrowly taking the lead from top importer China.

That comes as struggling large economies, including China’s, dent confidence in the global oil demand outlook.

(Reporting by Paul Carsten in London and Arathy Somasekhar and Georgina McCartney in Houston and Muyu Xu; Editing by Paul, Christian Schmollinger, Louise Heavens, David Evans, Barbara Lewis, Nick Macfie and David Ljunggren)

By Svea Herbst-Bayliss

NEW YORK (Reuters) -Billionaire investor William Ackman is offering a new hedge fund to U.S.-based retail investors, allowing Main Street to tap into his double digit performance gains previously reserved for Wall Street clients.

Ackman’s Pershing Square Capital Management said in a regulatory filing on Wednesday that the firm is launching Pershing Square USA, an investment vehicle that will be listed on the New York Stock Exchange.

There will be no minimum investment, the fund will charge a flat 2% fee every year after the first year and it will be available to retail investors who lack the net worth needed to invest in hedge funds.

The news could generate fresh buzz for the 57-year old fund manager who recently ventured beyond telling companies how to run their businesses to focusing on antisemitism on college campuses. He also pushed for the ouster of three university presidents over their handling of free speech in the wake of the Oct. 7 Hamas attack on Israel.

The new fund will be structured as a closed-end fund that raises money through an initial public offering and then its shares will trade on the exchange. It will be managed by Ackman, Ryan Israel, the firm’s chief investment officer, and other members of the investment team.

Previously Ackman’s funds were available only to high-net worth individuals, institutions and foreign investors who could put money into London-listed Pershing Square Holdings.

The filing does not say how much money the fund hopes to raise. Pershing Square Capital Management currently oversees roughly $18 billion in assets.

Ackman can launch the new fund since he structured the fees in a way to avoid U.S. regulators’ rules against charging retail investors the kind of incentive fees that hedge fund investors pay when the fund performs well.

Recent rule changes also now allow funds to use derivatives more. These are tools that have netted Ackman’s investors big gains over the past years through bets on credit markets during COVID and on interest rates last year.

As Ackman’s returns surged over the last years, interest in him and his funds has grown. The investor returned an average 31% gain a year over the last five years.

But his investment career has been studded with some notable losers as well, including a bet that Herbalife’s stock price would fall and that Valeant’s stock price would keep climbing.

(Reporting by Svea Herbst-Bayliss, editing by David Ljunggren)

By Lucia Mutikani

WASHINGTON (Reuters) – The U.S. trade deficit widened slightly in December, but contracted by the most in 14 years in 2023 as imports declined and exports jumped to a record high.

The report from the Commerce Department on Wednesday also showed the United States’ rising status as a major oil producer, with the inflation-adjusted value of petroleum exports surging 15.9% to a record high in December. The nation is now a net oil exporter and has reduced its dependence of foreign oil, helping to shrink the current account deficit.

Economists expected trade, which contributed to gross domestic product growth last year, to remain mostly supportive to the economy in 2024, though Red Sea shipping disruptions and drought in the Panama Canal posed risks.

“We look for net trade to remain a positive contributor to first-quarter growth,” said Matthew Martin, a U.S. economist at Oxford Economics. “The largest risk resulting from disruptions to global shipping is likely higher prices for goods, but longer lead times to receive goods could lead to either over- or underbuilding of inventories, which presents risks to our near-term outlook for imports.”

The trade deficit increased 0.5% to $62.2 billion, the Commerce Department’s Bureau of Economic Analysis said. Data for November was revised higher to show the trade gap shrinking to $61.9 billion instead of $63.2 billion as previously reported.

December’s trade shortfall was in line with economists’ forecasts. While it was close to the assumptions made by the government in its advance fourth-quarter GDP estimate published last month, November’s data was revised higher. Economists said the inflation adjusted or so-called real trade deficit was now smaller than the government had assumed.

They expected that trade’s contribution to GDP would be raised from the 0.43 percentage point estimated last month. On the bases of the December trade report, they anticipated that overall fourth-quarter GDP growth would be boosted to about a 3.6% annualized rate from the 3.3% pace reported in January when the government publishes its second estimate later this month.

“On the whole, the trade data for the fourth-quarter now look stronger than was anticipated with respect to GDP that quarter,” said Daniel Silver, an economist at JPMorgan in New York.

RECORD HIGH EXPORTS

The trade gap narrowed 18.7% in 2023, the largest drop since 2009, to $773.4 billion. It represented 2.8% of GDP, down from 3.7% in 2022. Trade added more than half a percentage point to the economy’s 2.5% growth last year.

Exports increased 1.2% to a record $3 trillion last year, propelled by capital goods, automotive vehicles, parts and engines as well as consumer and other goods. Imports slumped 3.6% to $3.8 trillion amid decreases in industrial supplies, which include petroleum, and consumer goods.

Exports ended the year on a strong note, rising 1.5% to $258.2 billion in December. Goods exports shot up 1.8% to $171.2 billion. Industrial supplies and materials exports increased $3.3 billion, amid rises in nonmonetary gold, other petroleum products and crude oil.

Consumer goods exports advanced as did those of foods, feeds and beverages. Services exports climbed $0.8 billion to a record $87.0 billion, lifted by travel, transport and financial services.

Imports picked up, increasing 1.3% to $320.4 billion in December. Goods imports rose 1.5% to $260.3 billion. There were gains in imports of consumer goods, mostly pharmaceutical preparations, and cell phones and other household goods.

Industrial supplies and materials imports also rose, but capital goods fell as did imports of automotive vehicles, parts and engines. Imports of services increased $0.5 billion to $60.1 billion amid a rise in transport. Travel services declined. The services surplus in December was the highest on record.

Economists were not too concerned about the decline in capital goods imports, which on face value would suggest weaker business investment and is over time associated with recession.

“Recessions are normally marked by sharp contractions in import volumes and, as yet, there is no sign that this is unfolding,” said Conrad DeQuadros, senior economic advisor at Brean Capital in New York.

The real goods trade deficit declined 1.4% to $82.8 billion in December. Real dollar exports of petroleum rose to a record $17.3 billion from $15.0 billion in November.

Real dollar exports of foods, feeds and beverages were the highest since June 2022, while those of automotive vehicles, parts and engines hit a 1-1/2-year low.

“The outlook for trade flows going forward is likely one of moderation given expectations of slower demand and growth going forward, both domestically and abroad,” said Rubeela Farooqi, chief U.S. economist at High Frequency Economics in White Plains, New York.

(Reporting By Lucia Mutikani; Editing by Chizu Nomiyama and Andrea Ricci)

By Ron Bousso

LONDON (Reuters) – Big Oil firms are handing shareholders more money than ever and are promising more going forward in an attempt to reassure investors of their discipline and resilience in the face of an uncertain outlook for fossil fuels.

The top five Western oil and gas firms – BP, Chevron, Exxon Mobil, Shell and TotalEnergies – returned to shareholders over $111 billion in dividends and share repurchases in 2023, according to Reuters calculation.

That was slightly higher than the $110 billion they returned in 2022, when the group’s profits soared to a record $196 billion after energy prices soared following Russia’s invasion of Ukraine. Net profits dropped sharply in 2023 to $123 billion. All five companies have reported results over the past week.

“During a time of geopolitical turmoil and economic uncertainty, our objective remained unchanged: safely deliver higher returns and lower carbon,” Chevron CEO Mike Wirth told investors last Friday.

Investors such as pension funds have traditionally held on to oil majors’ shares because of their steady, long-term dividends.

But the rise of the tech sector, a sharp drop in oil majors’ performance last decade due to excessive spending and oil price volatility as well as the growing environmental concerns have led to a decline in interest in the sector.

The energy sector accounted for 4.4% of the overall weighting of the S&P 500 index by the end of January, down from around 14% in the last decade, according to S&P data.

COMPLETE PREDICTABILITY

The group has revealed a clear transatlantic divide in strategies in recent years, with Chevron and Exxon focusing on growing oil production while BP, TotalEnergies and Shell invest a higher proportion of capital in low-carbon and renewables.

But the messaging to investors on returns was largely identical in recent days – stick with us and we’ll pay you.

“We’re very much focused on ensuring we have a compelling distribution to our shareholders,” Shell Chief Financial Officer Sinead Gorman told investors last week, vowing “complete predictability” over returns.

Shell, Chevron and TotalEnergies increased their dividend in the fourth-quarter results, while BP increased the rate of its buybacks. Exxon returned $32 billion to shareholders last year, the sector’s highest.

“Oil and gas is investors’ least favourite sector so spending gazillions on large mega-projects for cash flows in 5 years time with uncertain demand trends is very hard to stomach for many investors,” Berstein analyst Oswald Clint said.

“Inside the companies, they absolutely remember the sins of the past investment cycles and are pretty determined not to repeat those,” he added.

The sector is expected to make minimal spending increases in 2024, according to Tobias Wagner, Vice President, Senior Credit Officer at Moody’s Investors Service.

The increased discipline is a result of a few factors including investors’ demands for returns as well as an uncertain energy demand outlook, he said.

“Companies are being more selective and investments face greater hurdles in terms of returns, emissions and regulations.”

“The credit quality of the sector has improved with more upgrades than downgrades in recent years also reflecting discipline in maintaining balance sheet strength and flexibility,” Wagner said.

(Reporting by Ron Bousso; editing by David Evans)

By Georgina McCartney and Arathy Somasekhar

HOUSTON (Reuters) -Oil prices rose for a third day on Wednesday, drawing support from a larger-than-expected fall in U.S. gasoline and distillate stocks a day after the U.S. government cut its estimates for output growth.

Brent crude futures rose 39 cents to $78.98 a barrel as of 1144 a.m. ET (1644 GMT), while U.S. West Texas Intermediate crude climbed 37 cents to $73.68.

U.S. gasoline stocks fell by 3.15 million barrels last week compared with analysts’ estimates for a build of 140,000 barrels, according to the U.S. Energy Information Administration (EIA). Distillate stocks fell 3.2 million barrels, compared with estimates for a 1 million barrel draw.

Crude stocks, however, posted a larger-than-expected build of 5.5 million barrels as production recovered after a cold snap, while U.S. refiners stepped up maintenance. Analysts had estimated a smaller build of 1.9 million barrels.

“The main contributor to the crude oil build was that refineries have had difficulty returning operations from the freezing cold weather over the last couple of weeks,” according to Andrew Lipow, president of Lipow Oil Associates.

Refinery utilization shrank 0.5% to 82.4%. On the U.S. Gulf Coast, the deep freeze knocked off 15% of refining capacity, pressuring utilization rates to their lowest level since September 2021, according to EIA data.

On the supply side, the EIA cut its 2024 outlook for domestic oil output growth on Tuesday, putting it far lower than last year’s increase and predicting it would not reach December 2023’s record levels until February 2025.

This all strengthened the case that the oil market will be balanced in 2024, analysts at Haitong Futures said in a note, adding that oil prices should remain in a $10 range around current levels.

U.S., Qatari and Egyptian mediators prepared a diplomatic push to bridge differences between Israel and Hamas on a ceasefire plan for Gaza after the Palestinian group responded to a proposal for an extended pause in fighting and hostage releases.

Traders are following the situation in the Middle East, especially Iranian-backed Houthi rebels’ attacks on shipping in the Red Sea that have disrupted traffic through the Suez Canal, the fastest sea route between Asia and Europe and one that carries nearly 12% of global trade.

In the longer term, the International Energy Agency (IEA) said on Wednesday that India is expected to be the largest driver of global oil demand growth between 2023 and 2030, narrowly taking the lead from top importer China.

That comes as struggling large economies, including China’s, dent confidence in the global oil demand outlook.

(Reporting by Paul Carsten in London and Arathy Somasekhar and Georgina McCartney in Houston and Muyu Xu; Editing by Paul, Christian Schmollinger, Louise Heavens, David Evans, Barbara Lewis and Nick Macfie)

By Saqib Iqbal Ahmed

NEW YORK (Reuters) – New York Community Bancorp options drew increasingly bearish trading on Wednesday, as the bank’s shares extended their recent sell-off.

Put contracts that would guard against a plunge in the shares below $2 by mid-March were among the most actively traded, with about 8,000 of them changing hands as the stock fell about 13% to $3.65 on Wednesday morning. March puts at the $3 strike saw the heaviest volume, trading some 12,600 shares.

Rating agency Moody’s downgraded New York Community Bancorp’s long-term and some short-term issuer ratings to junk on Tuesday.

The bank’s shares have dropped more than 60% since January 30, after the lender disclosed huge provisions tied to likely sour loans from the commercial real estate segment, posted a quarterly loss and slashed its dividend payout.

“As we learned last year, banks that are facing a crisis can unravel quickly, so it’s not surprising that people would try to either hedge against it or speculate on it,” said Steve Sosnick, chief strategist at Interactive Brokers.

Overall, 131,000 New York Community Bancorp contracts traded in the first hour, about nine times the usual volume, according to Trade Alert data. Puts, typically bought to express a bearish or defensive view, outnumbered calls, generally a bullish play, 2.3-to-1.

Traders also picked up protection against a drop in the shares of the SPDR S&P Regional Banking ETF. The ETF’s shares have slipped about 13%, since January 30.

Still, bearish sentiment in the ETF’s options was not as extreme as in New York Community Bancorp’s contracts.

“While it’s clear that banks are continuing to underperform, and that we still see put buying in KRE and the like, it hasn’t yet developed into the type of situation we saw last March,” Sosnick said.

Meanwhile, short sellers targeting shares of a group of U.S. regional banks, including New York Community Bancorp were up about $1.37 billion in paper profits since January 30, according to data and analytics company Ortex. New York Community Bancorp alone accounted for about $174 million of those gains.

(Reporting by Saqib Iqbal Ahmed; Editing by Ira Iosebashvili and Nick Zieminski)

By Herbert Lash and Joice Alves

NEW YORK/LONDON (Reuters) – The dollar slid further on Wednesday as it consolidates a bounce in recent days from surprisingly strong U.S. economic data and pushback from Federal Reserve officials on market expectations of imminent interest rate cuts.

The dollar eased from a nearly three-month high against the euro on Tuesday even as market bets on a rate cut by the Fed in March rebounded. Treasury yields, often a factor in the dollar’s strength when they draw foreign investment, also were lower.

“The dollar’s rally is a bit overcooked, sort of in line with how I’m viewing U.S. yields,” said Brad Bechtel, global head of FX at Jefferies in New York.

“We’ve gone pretty far, pretty fast and we’re kind of bouncing up against some resistance levels.”

The dollar was down 0.14% to $1.0769 per euro, after retreating 0.1% on Tuesday, when it had earlier touched its strongest level since Nov. 14 at $1.0722.

The dollar index, a measure of the U.S. currency against six major peers, including the euro, slipped 0.08% to 104.06, following a 0.29% slide a day earlier. It had reached its highest since Nov. 14 at 104.60 on Monday.

“It’s really data that’s going to drive the next move. In the meantime, we’ll probably consolidate a little bit, pull back a little bit in the dollar, maybe rally a little bit in the euro and sterling,” Bechtel said.

Analysts pointed to technical factors for the dollar’s pullback, following a two-day rally of as much as 1.4% against the euro after unexpectedly strong U.S. jobs data, as well as more hawkish rhetoric from Federal Reserve Chair Jerome Powell, pummeled bets for a rate cut as soon as March.

U.S. Treasury yields gained some respite on Wednesday after falling from this week’s highs on solid demand at a sale of new three-year notes, removing some support for the dollar.

“Despite the ruling out of March rate cut hopes, the market is still showing some reluctance to go all in on the long U.S. dollar trade given the high conviction around rate cuts later in the year,” said Jane Foley, head of FX strategy at Rabobank.

Traders are currently pricing in a 23.5% chance of a rate cut in March, up from 14.5% on Monday, the CME Group’s FedWatch Tool shows. At the start of the year bets saw a 68.1% chance.

A sharper than expected fall in industrial production in the euro zone’s largest economy had no impact on the euro as “Germany’s industrial malaise is now a well-known story”, said Chris Turner, global head of Markets at ING.

The dollar edged 0.04% higher against the yen to 147.99, after sliding 0.49% on Tuesday. The currency pair tends to be extremely sensitive to moves in Treasury yields.

“Financial markets are in the process of recalibrating their expectations for Federal Reserve policy,” said James Kniveton, senior corporate forex dealer at Convera.

“If positive economic data, particularly on inflation, persists in the U.S., the tide could turn towards earlier rate cuts, potentially weakening the greenback further.”

Sterling rose 0.29% against the dollar to $1.2633 after higher house prices in Britain supported bets that the Bank of England (BoE) was not likely to cut interest rates any time soon.

(Reporting by Herbert Lash, additional reporting by Joice Alves in London and Kevin Buckland in Tokyo; Editing by Mark Potter, Emelia Sithole-Matarise and Deepa Babington)

By Sinéad Carew and Johann M Cherian

(Reuters) -The S&P 500 closed slightly higher on Tuesday, as investors scrutinized a mixed bag of earnings at big U.S. companies and digested comments from Federal Reserve policy makers for clues about its first planned interest-rate cut.

Minneapolis Fed President Neel Kashkari said the central bank is “not done yet” with inflation although he noted it had come down quickly with three-month and six-month inflation data “basically” at the Fed’s 2% goal.

Also, Cleveland Fed President Loretta Mester said that if the U.S. economy performs as she expects this could open the door to rate cuts. But Mester said she was not ready yet to suggest timing for easier policy due to inflation uncertainty.

On Sunday, Fed Chair Jerome Powell dashed any remaining hopes for a March rate cut. He had said the Fed can be “prudent” in deciding when to cut with a strong economy allowing time to build confidence that inflation is under control.

“The big macro news today is a couple of Fed governors confirming what Powell said over the weekend. It’s putting a little damper on markets today. It’s a little follow through from yesterday,” said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia.

Stocks were down for much of the session before rising just ahead of the close.

The Dow Jones Industrial Average rose 141.24 points, or 0.37%, to 38,521.36. The S&P 500 climbed 11.42 points, or 0.23 %, to 4,954.23 and the Nasdaq Composite gained 11.32 points, or 0.07 %, to end at 15,609.00.

John Praveen, Managing Director & Co-CIO at Paleo Leon said the Fed should not wait too long to ease policy as troubles at regional Bank NY Community Bancorp spotlight weakness in the rate-sensitive commercial real estate sector.

Powell also referred to the sector on Sunday. On Tuesday, U.S. Treasury Secretary Janet Yellen said she was concerned about commercial real estate stresses on banks and property owners, yet she believes the situation is manageable with assistance from bank regulators.

Praveen saw the comments adding to investor jitters.

The KBW Regional Banking index finished down 1.4%, marking a 12.6% drop over six sessions. New York Community Bancorp shares ended down 22.2%. The lender has lost about 60% of its value since it reported a surprise quarterly loss last week citing write-offs for some real estate clients.

Airlines helped advance the Dow Jones Transport Average, which closed up 2.1%, with signs of strong air travel demand. Frontier Group Holdings’ rallied 20.8% after it surprised investors with a break-even financial report.

With over half of S&P 500 companies now having reported earnings, 81.2% surpassed expectations, according to LSEG data. Overall S&P 500 earnings are expected to have risen 8.1% in the fourth quarter from the year-ago quarter.

GE HealthCare Technologies finished up 11.6% after the medtech firm posted better-than-expected fourth-quarter earnings, driving the S&P 500 healthcare sector to an all-time high.

The materials index was the biggest gainer among the S&P 500’s 11 major sectors. It gained 1.7% with shares in chemicals firm DuPont de Nemours jumping 7.4% after it beat fourth-quarter profit estimates, announcing a $1 billion share-repurchase program and hiking its dividend.

Palantir Technologies shares soared 30.8% after forecasting upbeat annual profit.

However, Eli Lilly closed down 0.2% even after forecasting 2024 profit above estimates.

Chip stocks pressured the tech-heavy Nasdaq with the Philadelphia SE Semiconductor index ending down 1%. Rambus Inc led declines in the sector as its shares plunged 19.2% after its quarterly report.

Advancing issues outnumbered decliners by a 2.6-to-1 ratio on the NYSE. There were 190 new highs and 64 new lows on the NYSE.

On the Nasdaq 2,721 issues advanced and 1,476 declined as Advancing issues outnumbered decliners by a 1.8-to-1 ratio on the Nasdaq. The S&P 500 posted 27 new 52-week highs and 8 new lows while the Nasdaq recorded 110 new highs and 122 new lows.

On U.S. exchanges 11.21 billion shares changed hands compared with the 11.54 billion average for the last 20 sessions.

(Reporting by Sinéad Carew in New York, Johann M Cherian and Ankika Biswas in Bengaluru; Editing by Pooja Desai and David Gregorio)

By Jamie McGeever

(Reuters) – A look at the day ahead in Asian markets.

All eyes – not least those of policymakers in Beijing – will laser in on Chinese stocks on Wednesday to see if they can continue their surge higher on the latest wave of expectations that authorities will take further steps to support markets.

China’s big two indexes jumped more than 3% on Tuesday for their biggest gains in almost two years, although it should be remembered that only last week had sunk to five-year lows.

Still, the bounce suggests that the overwhelming gloomy sentiment towards China, even if you think it is justified on a longer term fundamental basis, is probably over-cooked in the short term.

Bloomberg News had reported President Xi Jinping will discuss the stock market with financial regulators. Regulators also announced further curbs on short selling and state investors said they were expanding their stockbuying plans.

Of course, those of a more bearish disposition will view any spike higher as a better level to sell. These are mostly short-term fixes to stop the asset price rot, and will do little to address the country’s deeper-rooted economic problems.

China’s rally propelled the MSCI Asia & Pacific ex-Japan index to a 1.5% gain on Tuesday, its best day this year. The retreat in U.S. bond yields and the dollar could also provide further impetus for risk assets in the region on Wednesday.

The economic calendar on Wednesday is packed with potential market-moving data in several countries, while the Bank of Thailand delivers its latest policy decision and guidance.

Governor Sethaput Suthiwartnarueput’s press conference could be particularly interesting should he respond to Prime Minister Srettha Thavisin’s latest call on Tuesday for rates to be cut to revive economic growth.

Thavisin, who is also the finance minister, has been at loggerheads with the central bank over the direction of monetary policy, arguing the economy needed support and warning that the country risks facing deflation.

All 27 economists in a Reuters poll expect the BOT to keep its benchmark one-day repurchase rate unchanged at 2.50%, and 18 of 25 respondents predict no change this year. Rates markets pricing points to 40 basis points of cuts by year-end.

Foreign exchange reserves rarely have an immediate impact on financial markets, but many investors will be paying close attention to the latest snapshot of China’s on Tuesday.

China’s $3.238 trillion stash of FX reserves, the world’s largest, are the highest in a year. The share of that held in U.S. Treasuries, however, is falling – it is now less than 3%, down from a record 14% in 2011.

These calculations are based on China’s official reserves. Some analysts reckon the true total could be closer to $4 trillion once the holdings of state banks and off-shore entities are taken into account.

Here are key developments that could provide more direction to markets on Wednesday:

– Thailand interest rate decision

– China FX reserves (January)

– New Zealand unemployment (Q4)

(By Jamie McGeever; Editing by Bill Berkrot)