Indexes in U.S. Decline; Oil, Copper Down

123jump.com Staff
07 Apr, 2010
New York City

U.S. and European markets traded lower after commodities declined. The dollar strengthened against the euro as talks of Greek bonds default gained momentum. China plans to issue 3-year bills for the first time since June 2008.

[R]11:45 AM New York – U.S. and European markets traded lower after commodities declined. The dollar strengthened against the euro as talks of Greek bonds default gained momentum. China plans to issue 3-year bills for the first time since June 2008.[/R]

U.S. and European stocks traded lower tracking weakness in metals and commodities. Crude oil and copper led the decliners in the commodities after rising for three days in a row.

Worries of Greece defaulting on its sovereign debt continue to hamper Greek bonds. In Athens trading yields on Greek 10-year bond yields increased 0.16 to 7.14%. Yield premium to German bonds widened to 4.03%, the largest spread in eleven years.

Greece government stressed again yesterday that it does not need international financial assistance but a team of financial advisors are in Athens working with Greek government.

Fourth quarter gross domestic product in the euro area and wider zone of 27 nations increased 0.1% compared to previous quarter. Seasonally adjusted GDP compared to the quarter a year ago decreased 2.2% in the euro area and 2.3% in the EU27 in the fourth quarter of 2009.

Industrial producer price index increased in February 0.1% from January in the euro zone and 0.7% in the wider EU27 area.

Commodities, Currencies and Yields

Dollar edged higher against euro to $1.3338 and decreased against the Japanese yen to 94.02.

Crude oil decreased $1.05 to $86.46 a barrel for a front month contract, natural gas edged higher $0.016 cent to $4.11 per mBtu and gasoline decreased 2.80 cents to 235.00 cents.

Gold increased $4.00 in New York trading to close at $1,136.40 per ounce, silver closed higher $0.064 to $18.10 per ounce and copper for the front month delivery decreased 1.10 cents to $3.62 per pound.

Yields on 10-year U.S. bonds increased to 3.94% and on 30-year U.S. bonds traded at 4.82%.

Stock Movers

Family Dollar Stores, Inc rose 4.9% after the deep discount retailer reported comparable same-store sales increased 3.6% and fiscal second quarter adjusted profit of 81 cents a share.

JA Solar Holdings Co advanced 5% after it revised its shipment estimate in the first quarter to 265 megawatts from the previous estimate between 215 megawatts and 225 megawatts.

KeyCorp gained 4.9% after the lender was upgraded to “buy” from “neutral” at Goldman Sachs Group Inc.

Las Vegas Sands Corp fell 1.8% after the casino operator expanding in Macau and Singapore was downgraded to “neutral” from “buy” at UBS AG.

Earnings Review

Family Dollar Stores, Inc ((FDO)), the discount retailer reported second quarter sales rose 5% to $2.09 billion from $1.99 billion a year ago. Net income in the quarter rose 33.4% to $112.2 million or 81 cents per diluted share compared to net income of $84.1 million or 60 cents per share a year ago.

Monsanto Company ((MON)), the seed maker reported second quarter sales fell 3.7% to $3.89 billion from $4.04 billion a year ago. Net income in the quarter fell 18.6% to $887 million or $1.60 per diluted share compared to net income of $1.09 billion or $1.97 per share a year ago.

The Greenbrier Companies, Inc ((GBX)), a railroad equipment supplier reported second quarter revenues fell 30.3% to $200.0 million from $287.1 million a year ago. Net loss in the quarter was $4.4 million or 28 cents per diluted share compared to net loss of $7.8 million or 45 cents per share a year ago.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed higher 10.51 or 0.09% to 11,292.83, and Hang Seng index in Hong Kong increased 391.77 or 1.82% to 21,928.77, and CSI 300 index in China lower 18.20 or 0.53% to 3,386.95. ASX 200 index in Australia increased 7.20 or 0.15% to 4,960.90 and the FTSE Bursa KL Composite index in Malaysia was higher 0.72 or 0.05% to 1,345.09.

The Kospi Index in South Korea increased 0.51 or 0.03% to close at 1,726.60. SET index in Thailand closed higher 4.48 or 0.55% to 812.63. JSE Index in Indonesia increased 17.61 or 0.61% to 2,898.58. The Sensex index in India increased 28.65 or 0.16% to 17,970.02.

Europe Markets Review

In London FTSE 100 Index traded lower 8.98 or 0.16% to 5,771.37, in Paris CAC 40 Index decreased 10.32 or 0.25% to 4,043.62 and in Frankfurt DAX index traded lower 10.24 or 0.16% to 6,241.97. In Zurich trading SMI decreased 15.21 or 0.22% to 6,871.00.