U.S. Indexes Slide; AIG, Treasury Talks

123jump.com Staff
06 Aug, 2010
New York City

U.S. indexes traded lower after July payrolls declined and unemployment rate was flat at 9.5%. Indexes in Europe tracked lower. Wheat prices declined but hovered near 50% higher than in June. AIG quarterly operating profit increased 17% and said it has initiated the process of government stake sale.

[R]4:00 PM New York – U.S. indexes traded lower after July payrolls declined and unemployment rate was flat at 9.5%. Indexes in Europe tracked lower. Wheat prices declined but are still more than 50% higher than in June. AIG closed higher after quarterly operating profit increased 17% and said that it has initiated the process of government stake sale.[/R]

U.S. stocks decline after non-farm payrolls drop 131,000 in July. Treasury Secretary Geithner noted health care reform bill improved Medicare, Social Security finances. BP completes cementing procedure on the leaking Gulf of Mexico oil well.

AIG chief executive Robert Benmosche said in a memo to employees and confirmed by 123jump.com that it has initiated the discussion of transitioning the government state to private hands and terms of sale. AIG owes to the Federal Reserve $182.5 billion and $50 billion to the U.S. Treasury.

Activision Blizzard dropped after it estimated lower revenues. American Public Education plunged more than 28% after it canceled its annual outlook. Blue Nile dropped after net declined. Perkin Elmer surged as much as 9% after it lifted annual outlook. ATP Oil & Gas said net loss increased to $76 million. CBOE Holdings net plunged 12%.

The European indexes pare gains after weaker-than-estimated U.S. jobs data. German manufacturing output unexpectedly dipped in June. Greek CPI edged higher in July. Italian GDP expanded 0.4% in the second quarter and industrial production accelerates in June.

The UK indexes fall after reports showed a drop in temporary workers for the census in the U.S. The UK economy expanded 0.9% in the quarter ending July and output price inflation rose 5% in July but manufacturing output grew 0.3% in June. Inmarsat ordered three state-of-the-art satellites from Boeing.

Stocks in Japan dropped after a rise in weekly jobless claim in U.S. increased investor concerns. Toyota says its quality advisory panel will give initial recommendations shortly. The coincident index remains little changed in June.

Stocks in China region after regulators clarified the purpose of bank stress test. House price index drops for second month in Shanghai. Shanghai Volkswagen reports robust sales in July. Sina Corp posts better-than-expected second quarter profit.

Stocks in Mumbai moved sideways and then finished lower taking cues from Asian markets. Coal India Limited board approved draft prospectus of public offering. TRAI recommends a four step process of converting analog to digital TV for cable operators.

Stocks in Australia declined a fraction. RBA holds its forecast for economic expansion and said that resource sector expansion will determine the progress. Construction activity contracts further in July. Aston IPO is downgraded.

Commodities, Currencies and Yields

Dollar edged lower against euro to $1.328 and fell against the Japanese yen to 85.42.

Crude oil decreased $1.24 to $80.77 a barrel for a front month contract, natural gas edged lower 12 cent to $4.47 per mBtu and gasoline decreased 4.68 cent to 211.76 cents.

Gold increased $8.50 in New York trading to close at $1,207.80 per ounce, silver increased $0.15 to $18.47 per ounce and copper for the front month delivery decreased 0.70 cents to $3.35 per pound.

Yields on 10-year U.S. bonds decreased to 2.82% and on 30-year U.S. bonds declined to 3.99%.