World Stocks Down; U.S.Teasuries, Gold Rise

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

U.S. stocks traded sideways and gold rose after Japan reported slower than expected economic expansion in the latest quarter. Education stocks plunge. Euro-zone inflation rose to 1.7% in July and rating agency turned negative on the banking system in Slovakia. UK home prices edge lower.

[R]4:00 PM New York – U.S. stocks traded sideways and gold rose after Japan reported slower than expected economic expansion in the latest quarter. Education stocks plunge. Euro-zone inflation rose to 1.7% in July and rating agency turned negative on the banking system in Slovakia. UK home prices edge lower.[/R]

U.S. stock trade lower after Japan reported second quarter GDP expanded at 0.1%. China, now the second largest economy in the world after Japan recorded smaller GDP in the second quarter. Dell agreed to buy 3PAR for $1.15 billion. Lowe''s earnings rose 9.6% but lowers forecast.

U.S. stocks traded sideways and private education providers dropped sharply after the U.S. Department Education raised loan repayment concerns. Capella, ITT Educational Services, Corinthian Colleges and Strayer Education Inc plunged more than 15%. TAM SA surges 29%.

Cowen Group said quarterly sales tripled but net loss increased. Lowe’s Companies, Inc quarterly sales increased 3.7% and net income increased 9.6%. O''Charley''s Inc. quarterly sales decreased 5.9% and let loss was flat.

The European indexes declined after a fall in financial stocks. Euro-zone inflation rose 1.7% in July. Moody''s rated negative outlook for Slovakia''s banking system and industrial new order growth eased in June. Italy said current account deficit narrowed in June.

The UK indexes fall tracking losses in energy stocks. The UK commercial property price growth slackens in July and home prices drop 1.7% in August. Aviva confirmed rejection of RSA £5 billion cash offer. Hunting agreed to buy Innova-Extel for $125 million. Vedanta agreed to acquire stake in India unit of Cairn Energy for about $9.6 billion.

Stocks in Tokyo trading declined after June quarter GDP expanded at 0.1%, slower pace than the previous quarter. The quarterly GDP also fell below that of China’s. Toyota Corp retained its number one position in auto sales in the first half.

Stocks in China gained the most in a week led by healthcare and banking companies while those in Hong Kong echoed mainland sentiments and gained modestly. China’s second quarter economic output surpasses that of Japan. Agricultural Bank of China completes the world’s largest public offering.

Stocks in Mumbai traded lower on mixed earnings and weak global markets sentiment. Wholesale inflation declined to a six month low in July after food price inflation fell. Vedanta agrees to buy as much as 60% stake in Cairn India. SKS Microfinance surges 18% on first day in trading.

Stocks in Tokyo trading declined after June quarter GDP expanded at 0.1%, slower pace than the previous quarter. The quarterly GDP also fell below that of China’s. Toyota Corp retained its number one position in auto sales in the first half.

Commodities, Currencies and Yields

Dollar edged higher against euro to $1.28 and fell against the Japanese yen to 85.32.

Crude oil decreased $0.22 to $75.17 a barrel for a front month contract, natural gas edged lower 10 cents to $4.23 per mBtu and gasoline decreased 1.76 cent to 192.20 cents.

Gold increased $10.20 in New York trading to close at $1,226.80 per ounce, silver increased $0.30 to $18.46 per ounce and copper for the front month delivery decreased 2.75 cents to $3.30 per pound.

Yields on 10-year U.S. bonds decreased to 2.58% and on 30-year U.S. bonds yields decreased 3.72%.