US update: dollar and stocks fall, tax cut woes, cocoa hot

The dollar lost ground on Friday after US Senate Republicans announced tax reforms late on Thursday that failed to match the business and corporate rates promised by their colleagues in the House of Representatives. Most importantly, the 20% corporate rate will be delayed by a year and small businesses will receive a deduction rather than a special rate.

The major US indexes and the dollar fell as a result, with the US currency down 0.13% on a trade-weighted basis. While the dollar remains down more than 8% on the year, it has rallied nearly 1.5% since President Trump announced details of his sweeping tax proposals in late September. In the same period, the benchmark S&P 500 index has rallied 3.1%. The index is up about 20% since Trump was elected in November 2016.

Stocks remain close to record levels, however, as third-quarter earnings season slows down. With more than four-fifths of the S&P 500 companies having already reported, total earnings are up 8%, compared with expectations of a 5.9% rise.

Nvidia was one of the big gainers, up 5.27% to $216.14 after beating earnings forecasts.

• Dow 23,422.21 -0.17%
• S&P 500 2,582.3 -0.09%
• NASDAQ 6,750.94 +0.01%
• Russell 2000 1,474.53 -0.07%
• NYSE Composite 12,322.61 -0.14%
• Gold 1,275.13 -0.96%
• Oil WTI $56.88 -0.51% (5.11PM EST)
• 10-Year Treasury 2.4% +0.07bp

News Corp's Rupert Murdoch: company beats earnings forecasts in the third quarter: Wikimedia Commons

News Corp blasts earnings forecasts

News Corp was the biggest gainer on the S&P 500 after the publishing arm of Rupert Murdoch's global media operations reported forecast-beating results after Thursday's close.

The owner of the Wall Street Journal and The Times reported total revenue rose 4.5% to $2.06bn in the third-quarter, beating forecasts of $1.98bn, while net income rose to $68m, compared with a loss of $15m in the same period a year ago.

Shares in News Corp rose 5.15% to $15.10.

Cocoa prices up 17% since August

US chocolate lovers may not have noticed the price of cocoa going up amid the noise of tax cuts, presidential visits, and the daily banter between Trump and Kim Jong-Un.

But in just the past three months cocoa futures in New York have risen by more than 17%. On Friday, they were up again, rising 1.6% to $2,223 a tonne.

Commodity traders are concerned about a drop in Ecuadorean stocks after itchgrass, a fast-growing and destructive weed, was found in some cocoa shipments.

Meanwhile, the Ivorian crop appears to be down on last year according to data received by Bloomberg from ports in Cote d'Ivoire, the world's biggest cocoa producer. The data this week showed that cumulative arrivals at the African nation's ports total 225,000 tonnes, compared with 235,000 tonnes for the same period last year.

There were also reports last month that reduced levels of financing for Ivorian exporters were hampering international sales of the commodity.

"Banks have become more concerned financing exporters following the defaults seen on export contracts last season," said Hamza Khan head of commodities strategy at ING.