US open: Stocks push further into record territory, but gains limited

(Sharecast News) - US stocks inched higher in early deals on Wednesday, though gains were limited as investors refrained from taking on too much risk with markets already at record highs amid a volatile geopolitical environment.

Market participants were also keeping a close eye on a flurry of economic data, which showed fewer-than-expected jobs gains, a decline in factory orders and fewer job openings than predicted.

By 1446 GMT, the Dow was flat (+0.01%), while the S&P 500 and Nasdaq pushed slightly higher (up 0.13% and 0.24% respectively).

Both the Dow and S&P 500 hit fresh all-time closing highs the previous session - along with markets in London, Tokyo, Singapore and Busan - as investors reacted to the fallout from Donald Trump's controversial cross-border military operation on Venezuela at the weekend, which saw Venezuelan president Nicolas Maduro moved to a federal jail in New York on 'narco-terrorism' charges.

Trump has said Venezuela would be "turning over" between 30m and 50m barrels of "High Quality, Sanctioned Oil" following an agreement struck with Caracas, the US president said in a social media post.

In new developments, Trump has now renewed his focus on Greenland as his next potential target for American expansionism, claiming that annexing the region is a "national security priority". The White House said the US president was looking at "a range of options" to take over the semi-autonomous Danish territory, and could potentially use military action to get what he wants.

Several European leaders rallied on Tuesday in support of Denmark, a fellow Nato member, which is opposed to Trump's demands and has challenged his assertions that Chinese vessels are operating in the region in large numbers.

Economic data barrage

Aside from geopolitics, the release of the ADP employment report for December was garnering some attention after showing the private employers added just 41,000 jobs in December, up from a revised 29,000 reduction in November but short of the 47,000 expected.

US factory orders fell by 1.3% in October, following a 0.2% increase the previous month, coming in worse than the 1.2% decline predicted by economists.

The ISM services PMI increased more than expected to 54.4 in December from 52.6 the previous month, surprising the market which expected a drop to 52.3.

Meanwhile, the JOLTS survey showed that job openings totalled just 7.146m in November, down from a revised 7.449m in October and well below the 7.6m consensus forecast.

Energy stocks in focus

Stocks across America's energy industry were closely watched as markets continue to assess the implications of Trump's assault on Venezuela.

"President Trump's comments overnight that the US would primarily benefit from supply - with 50 million barrels expected to be bound for America - have muted expectations for both the oil price, which has fallen," said Emma Wall, chief investment strategist at Hargreaves Lansdown. WTI crude was down 1.1% at $56.53 a barrel early on.

Chevron, which remains the only remaining major American producer in Venezuela, was trading flat after a sharp rise and subsequent fall over Monday and Tuesday. Chevron was also in the news after an FT report suggested it is considering a bid with Quantum Capital Group for $22bn of Lukoil assets.

However, refiners Valero and Phillips 66, who both made significant moves over the past two days, were making solid gains, while producers ExxonMobil and ConocoPhillips were trading lower again.