Dow Down 3.2%; Euro 4-Year Low

Mayank Mehta, Chandrasekhar Atreya and Sanjay Barot
04 Jun, 2010
New York City

U.S. indexes plunged after a disappointing jobs data and weakness in the euro. The latest U.S. employment data showed weak private sector additions. The euro dropped to a four-year low after negative comments from Hungarian officials.

[R]4:15 PM New York – U.S. indexes plunged after a disappointing jobs data and weakness in the euro. The latest U.S. employment data showed weak private sector additions. The euro dropped to a four-year low after negative comments from Hungarian officials.[/R]

U.S. indexes plunged after employment increases by 431,000 and unemployment rate declined to 9.7% in May. The bulk of the increase in employment was driven by 411,000 hires for census jobs and weaker than expected increase in private jobs depressed the trading sentiment in New York.

European stocks trade lower after disappointing U.S. jobs data and talks of a sovereign debt crisis in Hungary. The euro declined below $1.20 for the first time since 2006 after negative comments from Hungarian officials. Euro-zone GDP expands 0.2% in the first quarter.

UK home prices drop 0.4% month-on-month in May.

Naoto Kan was elected as the next Prime Minister in Japan. Stocks in volatile trading closed marginally lower. Fuji Heavy Industries led gainers in the Nikkei 225 Stock Average with a gain of 7%.

Stocks in Shanghai closed higher but in Hong Kong traded lower. World Bank estimated economic growth in China to cool in the rest of the year and range between 9% and 10%. Baoshan Iron & Steel to cut prices in July. Foxconn Line Workers in China get 30% pay increase after a series of suicides.

Stocks in Mumbai trade higher and the government deregulated the natural gas market. ONGC and OIL closed higher. ArcelorMittal plans to set a steel plant in Karnataka. TVS Motor jumps on strong sales in May. Ashok Leyland sales rises 21%.

Australia’s stocks and dollar declined after metal prices fell in the world market. Finance ministers of G-20 nations are meeting in South Korea today to agree on measures to prevent future financial crisis. Gold coin sales to Europe increase in May. Queensland restricts new developments in Wenlock river basin.

North American Markets

Dow Jones Industrial Average decreased 324.06 or 3.2% to close at 9,931.22, S&P 500 Index decreased 37.95 or 3.4% to 1,064.88 and Nasdaq Composite Index dropped 83.86 or 3.6% to close at 2,219.17. Toronto TSX Composite Index dropped 235.07 or 2% to 11,576.80.

Latin American Markets Indexes

Mexico IPC Index dropped 290.03 or 0.9% to 31,041.83 and Brazil Bovespa Stock Index fell 1,397.48 or 2.2% to 59,083.15.

Europe Markets Review

In London FTSE 100 Index traded lower 80.36 or 1.54% to 5,130.82, in Paris CAC 40 Index traded decreased 94.38 or 2.65% to close at 3,462.96, in Frankfurt DAX Index traded lower 102.97 or 1.70% to close at 5,951.66. In Zurich trading SMI Index traded decreased 101.42 or 1.58% to close at 6,317.40.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 13.00 or 0.13% to 9,901.19, Hang Seng index in Hong Kong decreased 6.64 or 0.03% to 19,780.07 and CSI 300 index in China higher 8.32 or 0.30% to 2,744.39. ASX 200 index in Australia decreased 36.60 or 0.82% to 4,449.40. The FTSE Bursa KL Composite index in Malaysia closed lower 0.05 or 0.00% to 1,294.39.

The Kospi Index in South Korea increased 2.29 or 0.14% to close at 1,664.13. SET index in Thailand closed higher 5.52 or 0.72% to 771.48 and JSE Index in Indonesia increased 12.27 or 0.44% to 2,823.25. The Sensex index in India increased 95.36 or 0.56% to 17,117.69.

Commodities, Metals, and Currencies

Crude oil decreased 5% or $3.46 to $71.15 a barrel for a front month contract, natural gas edged up 10 cent to $4.79 per mBtu and gasoline decreased 9.60 cents to 199.06 cents.

Soybean future closed down 20.00 cent to $9.35 a bushel. Wheat futures decreased 6.0 cents in Chicago trading to $4.35 a bushel. Sugar closed up 0.53 cents at 14.52 cents a pound.

Gold increased $8.30 in New York trading to close at $1,218.30 an ounce, silver closed down $0.53 to $17.40 per ounce and copper for the front month delivery decreased 14.85 cent to $2.79 per pound.

Dollar edged higher against the euro to $1.196 and fell against the Japanese yen to 91.66.
The euro fell below $1.20 for the first time since 2006.

Yield on 10-year U.S. bonds increased to 3.19% and with 30-year maturities closed higher to 4.13%.