World Stocks, Euro, Oil Drop

Mayank Mehta, Arthi Gupta and Darlington Musarurwa
14 May, 2010
New York City

Euro-zone breakup talks gained considerable momentum after Paul Volcker and others expressed doubts on the health of the region. Euro dropped to 18-month low and gold reached a new high. Oil fell as much as 4%. Chinese debt auction drew less than expected interest for the second time in a month.

[R]4:10 PM New York – Euro-zone breakup talks gained considerable momentum after Paul Volcker and others expressed doubts on the health of the region. Euro dropped to 18-month low and gold reached a new high. Crude oil fell as much as 4%. Chinese debt auction drew less than expected interest for the second time in a month.[/R]

U.S. stocks decline following losses in Europe and gold surged to a record high. Fears of euro-zone collapse and mounting tension in the currency region dragged sentiment around the world lower.

U.S. economic data pointed to improving conditions with retail sales rising 0.4% in April. CA Inc, Nordstrom and JC Penney report higher earnings. Visa and MasterCard drop more than 9% after the U.S. Senate voted in favor limiting interbank fees for debit card transactions.

Newmont Mining Corporation led gainers in the S&P 500 index. Dillard''s net income jumps six-fold. Blockbuster swings to quarterly loss of $67.1 million. Nordstrom profit rises 43% on same-store sales gains.

The euro touched an 18-month low on concerns that the austerity measures throughout Europe may slow European growth. EADS NV and Banca Monte dei Paschi di Siena SpA report lower profits.

U.K. stocks fall as investors seek refuge in safe-haven currencies. Investors are still jittery about the debt crisis in Europe and the sufficiency of the $1 trillion package to the EU region. Monthly average price of residential property rises. Wolseley plc doubles trading profit.

Nikkei Stock Average declined 1.5% today and dropped 0.9% in the week. Shinsei, Aozora Bank merger proposal scrapped. Mizuho Financial Group profit soars to 239.4 billion yen. Sumitomo Mitsui Financial Group annual profit climbs to 271.5 billion yen in 2009.

Stocks in Shanghai dropped today and for the year declined more than 20%. China plans to encourage private investment in hospitals, community health services. Poly Real Estate''s contracted sales rise 16.2% in the year to April. Hedge fund manager Soros took a stake in Alibaba.com in third quarter of 2009.

India plans debt fund for infrastructure development. OVL inks agreement with Venezuela for oil exploration. Aban Offshore falls as Venezuela says Rig-Sinking is being probed. State Bank of India said fourth quarter net declined 32%.

Stocks fell ahead of release of key indices data next week. Healthscope receives A$1.74 billion bid. Gindalbie raises A$175 million for iron ore project.

North American Markets

Dow Jones Industrial Average fell 162.79 or 1.5% to close at 10,620.16, S&P 500 Index decreased 21.75 or 1.9% to 1,135.69 and Nasdaq Composite Index fell 47.51 or 2% to close at 2,346.85. Toronto TSX Composite Index fell 138.38 or 1.2% to 11,978.21.

Latin American Markets Indexes

Mexico IPC Index decreased 559.42 or 1.7% to 31,783.01 and Brazil Bovespa Stock Index fell 1,496.74 or 2.3% to 63,291.48.

Europe Markets Review

In London FTSE 100 Index closed lower 95.69 or 1.76% to 5,338.04, in Paris CAC 40 Index decreased 87.99 or 2.36% to close at 3,643.55, in Frankfurt DAX index lower 74.09 or 1.19% to close at 6,177.88. In Zurich trading SMI decreased 75.61 or 1.15% to close at 6,499.44.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 158.04 or 1.49% to 10,462.51, Hang Seng index in Hong Kong decreased 277.03 or 1.36% to 20,145.43 and CSI 300 index in China lower 18.89 or 0.65% to 2,868.02. ASX 200 index in Australia decreased 41.70 or 0.90% to 4,611.10. The FTSE Bursa KL Composite index in Malaysia closed lower 7.62 or 0.57% to 1,339.30.

The Kospi Index in South Korea increased 1.05 or 0.06% to close at 1,695.63. SET index in Thailand closed higher 2.24 or 0.29% to 768.79 and JSE Index in Indonesia increased 10.76 or 0.38% to 2,858.38. The Sensex index in India decreased 271.27 or 1.57% to 16,994.60.

Commodities, Metals, and Currencies

Crude oil decreased $2.83 to $71.57 a barrel for a front month contract, natural gas edged down 2 cents to $4.32 per mBtu and gasoline decreased 6.77 cents to 212.74 cents.

Soybean future closed down 11.0 cent to $9.53 a bushel. Wheat futures decreased 7.50 cents in Chicago trading to $4.71 a bushel. Sugar closed down 0.53 cents at 14.13 cents a pound.

Gold increased $3.00 in New York trading to close at $1,232.20 an ounce, silver closed down $0.24 to $19.26 per ounce and copper for the front month delivery decreased 10.50 cent to $3.12 per pound.

Dollar edged higher against euro to $1.239 and fell against the Japanese yen to 92.21.

Yield on 10-year U.S. bonds decreased to 3.44% and with 30-year maturities decreased to 4.32%.