Economic Worries; Gold Up 1.5%

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

U.S. stocks declined after jobless claims rose, yet another data point suggesting protracted economic recovery after trade deficit widened. Energy prices declined but gold rose more than 1% for the second day in a row. The European Central Bank estimated moderate growth in the euro area.

[R]4:00 PM New York – U.S. stocks declined after jobless claims rose, yet another data point suggesting protracted economic recovery after trade deficit widened. Energy prices declined but gold rose more than 1% for the second day in a row. The European Central Bank estimated moderate growth in the euro area.[/R]

U.S. stocks traded lower after weekly jobless claims rose 2,000 and foreclosure filings fell in July. Indexes fell after worries of economic revival resurfaced as jobless claims rose and a day before trade deficit widened.

Energy complex prices declined gold increased more than 1% for the second day.

Apache completed acquisition of BP Permian Basin assets for $3.1 billion. Cisco Systems quarterly sales increased 27% and net surged 79%. Kohl’s Corp sales rose 7.6% and net increased 13.5%. Sara Lee Corp said quarterly sales increased 4.2% and swung to a net loss.

The European indexes declined after U.S. weekly jobless claims rose and Euro-zone industrial output dipped in June. The ECB estimated moderate growth in the euro area. Hungarian banks tightened household lending conditions.

The UK indexes gained after GlaxoSmithKline won regulatory approval for ezogabine. UK mortgage possession claims eased in the second quarter. Irish CPI slackened in July. Centrica agrees to acquire Suncor gas assets for £229 million.

Stocks in Japan dropped pushing the benchmark index down 20% in the year, signifying a bear market phase. Orders for steel products rose 6% in June. Total outstanding commercial paper debt reaches the 10 trillion yen.

Stocks in China region tumbled for the second day on global outlook. Consumer confidence rises in the second quarter with the rural areas benefitting from a rise in government spending. Hong Kong Exchanges and Clearing Ltd reported 3% increase in first half.

Stocks in Mumbai closed little changed despite SBI reported a 25% increase in quarterly profit. Industrial production increased at a slower pace in June. Reserve Bank of India is reviewing its policy to issue additional bank licenses and may require minimum capital of $250 million. Ssangyong Motor chooses Mahindra & Mahindra as preferred bidder.

Stocks in Australia fell further after unemployment in July increased to 5.3%. Coal exports increased from Newcastle port helped by drier weather. AGL Energy plans to expand in renewable energy projects.

Commodities, Currencies and Yields

Dollar edged higher against euro to $1.28 and fell against the Japanese yen to 85.91, a fifteen high.

Crude oil decreased $2.28 to $75.75 a barrel for a front month contract, natural gas edged lower 3 cent to $4.29 per mBtu and gasoline decreased 4.15 cent to 195.60 cents.

Gold increased $17.40 in New York trading to close at $1,216.60 per ounce, silver increased $0.12 to $18.02 per ounce and copper for the front month delivery increased 1.95 cents to $3.29 per pound.

Yields on 10-year U.S. bonds decreased to 2.74% and on 30-year U.S. bonds yields decreased 3.94%.