U.S. Stocks Struggle; World Markets Fall

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

U.S. and world stocks traded lower after the regulators in the UK and Germany and may seek information after the SEC alleged mortgage fraud. Citigroup Inc rose after it swung to net income in the first quarter on lower loan losses. Commodities declined.

[R]1:00 PM New York – U.S. and world stocks traded lower after the regulators in the UK and Germany and may seek information after the SEC alleged mortgage fraud. Citigroup Inc rose after it swung to net income in the first quarter on lower loan losses. Commodities declined.[/R]

Stocks around the world declined after a surprise SEC alleged Goldman Sachs engaged in mortgage securities fraud. The allegation prompted more inquiries from regulators in Germany and UK.

Commodities declined and the dollar advanced as investors sought safety of the dollar.

Citigroup Inc soared 6% after the bank reported first quarter net was $4.43 billion compared to a loss of $7.58 billion.

Commodities, Currencies and Yields

Dollar edged higher against euro to $1.3436 and decreased against the Japanese yen to 92.00.

Crude oil decreased $2.28 to $80.96 a barrel for a front month contract, natural gas edged higher $0.02 cent to $4.04 per mBtu and gasoline decreased 4.410 cents to 223.29 cents.

Gold decreased $6.60 in New York trading to close at $1,130.30 per ounce, silver closed lower $0.150 to $17.52 per ounce and copper for the front month delivery decreased 4.950 cents to $3.60 per pound.

Yields on 10-year U.S. bonds increased to 3.77% and on 30-year U.S. bonds traded at 4.67 %.

Stock Movers

The Bank of New York Mellon Corporation added 1.0%.

CME Group Inc rose 0.5%

Cornell Companies, Inc surged 30.2% after the GEO Group will acquire the company for stock and cash at an estimated enterprise value of $685 million based on the closing prices of both companies'' stocks on April 16, including the assumption of approximately $300 million in debt, excluding cash.

DynCorp International Inc the defense contractor added 0.2%.

The Goldman Sachs Group, Inc declined additional 1.9% today after dropping 13% on Friday after the SEC investigation prompted other regulators in Europe to request more information.

National Semiconductor Corporation rose fell 0.7% after the maker of integrated circuits announced the appointment of William J. Amelio and William E. Mitchell to company’s board of directors.

Shenandoah Telecommunications Company rose 1.2% after the Virginia-based phone and cable operator signed agreement to purchase the cable operations of JetBroadband Holdings, LLC located in southern Virginia and southern West Virginia for $148 million.

Earnings Review

Arch Coal, Inc ((ACI)), the coal producer reported first quarter sales rose 4.5% to $711.9 million from $681.0 million a year ago. Net loss in the quarter was $1.8 million or 1 cent per diluted share compared to net income of $30.6 million or 21 cents per share a year ago.

Arch Coal, Inc, in the last one year traded as high as $28.34 in January 2010 and as low as $12.52 in April 2009. Based on the Friday’s closing price of $26.00 the company has market cap of $4.22 billion.

Citigroup Inc ((C)), the bank reported first quarter revenues rose 3.7% to $25.4 billion from $24.5 billion a year ago. Net income in the quarter rose 178.6% to $4.43 billion or 15 cents per diluted share compared to net income of $1.59 billion or loss at 18 cents per share a year ago.

Eli Lilly and Company ((LLY)), the drugmaker reported first quarter revenues rose 8.7% to $5.49 billion from $5.05 billion a year ago. Net income in the quarter fell 4.6% to $1.25 billion or $1.13 per diluted share compared to net income of $1.31 billion or $1.20 per share a year ago.

McMoRan Exploration Co ((MMR)), an oil and gas company reported first quarter sales rose 36% to $132.5 million from $97.4 million a year ago. Net loss in the quarter was $66.2 million or 74 cents per diluted share compared to net loss of $63.2 million or 90 cents per share a year ago.

McMoRan Exploration Co, in the last one year traded as high as $18.80 in March 2010 and as low as $4.26 in April 2009. Based on the Friday’s closing price of $15.36 the company has market cap of $1.42 billion.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 193.41 or 1.74% to 10,908.77, Hang Seng index in Hong Kong decreased 460.09 or 2.10% to 21,405.17 and CSI 300 index in China lower 179.91 or 5.36% to 3,176.42. ASX 200 index in Australia decreased 69.60 or 1.40% to 4,915.10. The FTSE Bursa KL Composite index in Malaysia closed lower 6.10 or 0.46% to 1,326.67.

The Kospi Index in South Korea decreased 29.19 or 1.68% to close at 1,705.30. SET index in Thailand closed lower 9.87 or 1.34% to 726.29 and JSE Index in Indonesia decreased 38.25 or 1.33% to 2,840.42. The Sensex index in India decreased 190.50 or 1.08% to 17,400.68.

Europe Markets Review

In London FTSE 100 Index traded lower 31.53 or 0.55% to 5,712.43, in Paris CAC 40 Index decreased 26.63 or 0.67% to 3,960.00 and in Frankfurt DAX index traded lower 23.57 or 0.38% to 6,157.33. In Zurich trading SMI decreased 105.65 or 1.53% to 6,788.04.