U.S. Stocks Turn Lower; Goldman Sachs Plunges

Arthi Gupta, Mayank Mehta and Sanjay Barot
30 Apr, 2010
New York City

Stocks and indexes closed lower in New York trading on the growing belief that regulators may add criminal charges to ongoing investigation of Goldman Sachs. Barclays Plc fell more than 8% after it reported weaker than expected earnings.

[R]4:00 PM New York – Stocks and indexes closed lower in New York trading on the growing belief that regulators may add criminal charges to ongoing investigation of Goldman Sachs. Barclays Plc fell more than 8% after it reported weaker than expected earnings.[/R]

Market indexes in New York fell after technology stocks declined and Goldman Sachs dropped on the growing speculation that regulatory authorities are looking to expand their investigation and add criminal charges. Goldman Sachs dropped 9.4%.

Higher consumer spending lifted preliminary estimate of the first quarter GDP growth to 3.2%. However housing investments declined 10.9% in the quarter. Contribution from the inventory rebuilding declined sharply in the quarter. Greece may struggle to implement tougher wage and pension conditions attached with the bailout.

MEMC Electronic Materials, Inc led the decliners in the S&P 500 index with a loss of 15%. Allergan reports higher quarterly earnings. Chevron first quarter net income grows by 147%. Nasdaq OMX profit climbs but lags estimates. Coventry Health lifts view as profit doubles.

European investors surmised that Greece and the EU-IMF will soon finalize the details of bailout. The euro and stock market indexes in the region advanced. However, Greece may be forced to implement additional and tougher austerity measures.

The euro gained as fears of Greece debt default receded for now and March unemployment hovered at 10%. Italy''s PPI rises in March. Polish insurer PZU SA raises $2.7 billion in a public offering, the largest in three years. Total''s first quarter profit up 14% on higher oil prices. Metro AG first quarter sales rose 2%.

U.K. stocks decline as weak consumer confidence and uncertainty over the Greek bailout aid package marred investor sentiment. The pound gains against the dollar. Barclays net rises 29%. WPP raises outlook.

Japan’s unemployment rate at 5% in March and family spending advanced 4.4% in the month. The consumer price index rises 0.3% in March. Ashok Leyland Nissan venture in India plans to roll out light commercial vehicle in 2011.

The Sensex index in India advance on the back of positive earnings. Foreign holdings of stocks increased to record $79.1 billion and bonds to $13 billion. Gold price reached to 4-month high ahead of wedding season.

Australian dollar rises as Greece agrees to €24 billion austerity measures. Regulator approve Shell/PetroChina bid for Arrow. Woolworths Ltd cuts sales forecast and reported lower than expected third quarter sales growth. Santos chief says ETS delay will affect investment.

North American Markets

Dow Jones Industrial Average increased 122.05 or 1.1% to close at 11,167.32, S&P 500 Index edged higher 15.42 or 1.3% to 1,206.78 and Nasdaq Composite Index added 40.19 or 1.6% to close at 2,511.92. Toronto TSX Composite Index added 123.43 or 1% to 12,200.32.

Latin American Markets Indexes

Mexico IPC Index fell 91.86 or 0.3% to 32,861.00 and Brazil Bovespa Stock Index added 1,322.34 or 2% to 67,978.05.

Europe Markets Review

In London FTSE 100 Index closed lower 57.55 or 1.02% to 5,560.29, in Paris CAC 40 Index decreased 26.13 or 0.68% to close at 3,814.49, in Frankfurt DAX index lower 14.91 or 0.24% to close at 6,130.00. In Zurich trading SMI decreased 66.17 or 0.99% to close at 6,599.67.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed higher 132.61 or 1.21% to 11,057.40, Hang Seng index in Hong Kong increased 329.67 or 1.59% to 21,108.59 and CSI 300 index in China higher 7.30 or 0.24% to 3,067.36. ASX 200 index in Australia increased 21.80 or 0.46% to 4,807.40. The FTSE Bursa KL Composite index in Malaysia closed higher 10.52 or 0.79% to 1,346.38.

The Kospi Index in South Korea increased 13.14 or 0.76% to close at 1,741.56. SET index in Thailand closed higher 10.31 or 1.37% to 763.51 and JSE Index in Indonesia increased 44.39 or 1.52% to 2,971.25. The Sensex index in India increased 55.24 or 0.32% to 17,558.71.

Commodities, Metals, and Currencies

Crude oil increased $0.83 to $86.00 a barrel for a front month contract, natural gas edged down 5 cents to $3.93 per mBtu and gasoline increased 4.07 cents to 239.63 cents.

Soybean future closed up 3.00 cent to $9.99 a bushel. Wheat futures increased 7.50 cents in Chicago trading to $5.03 a bushel. Sugar closed down 0.14 cents at 15.15 cents per pound.

Gold increased $10.20 in New York trading to close at $1,179.00 per ounce, silver closed up $0.08 to $18.66 per ounce and copper for the front month delivery increased 0.55 cent to $3.35 per pound.

Dollar edged lower against euro to $1.331 and decreased against the Japanese yen to 93.97.

Yield on 10-year U.S. bonds decreased to 3.66% and with 30-year maturities fell to 4.52%.