Stocks Rise After Bonds Sales in U.S., Europe

Devan Biswas
08 Sep, 2010
New York City

Market indexes in the U.S. and Europe recovered with the sentiment. U.S. Treasury bonds inched up after the latest $21 billion auction drew the best response from central banks. Bonds in Europe also recovered after Portugal completed the sale of $1.3 billion.

[R]4:00 PM New York – Market indexes in the U.S. and Europe recovered with the sentiment. U.S. Treasury bonds inched up after the latest $21 billion auction drew the best response from central banks. Bonds in Europe also recovered after Portugal completed the sale of $1.3 billion. Greece GDP shrank but the UK manufacturing surged to 16-year high.[/R]

U.S. stocks followed the bond trading. U.S. bonds traded higher after the U.S. Treasury completed the sale of 10-year $21 billion bonds that drew one of the best responses from foreign central banks.

In Europe, Portugal completed the sale of $1.3 billion of bonds that mature in 2013 and 2021. In addition, Ireland also said it is looking to split Anglo Irish Bank Corp Ltd.

BP released report on causes of Gulf of Mexico tragedy. Bristol-Myers Squibb proposed to buy ZymoGenetics for $9.75 per share. Ciena third quarter revenue surged 137%.

Hewlett-Packard declined and the company sued the ex-CEO. Navistar International Inc declined more than 5% after it missed revenues estimates. Silicon Laboratories Inc dropped 10% after it lowered its revenues outlook.

The European indexes gained after a successful bond auction in Portugal. Greece’s second quarter GDP shrank 3.7% from a year ago. French trade deficit widened in July and German exports fell in July. Galapagos finalized deal to acquire GlaxoSmithKline research centre in Croatia.

The UK indexes traded higher after home prices rose in August and the economy expanded at a slower pace in the quarter to August. Vodafone agreed to sell China Mobile stake for £4.3 billion. BAE Systems agreed to acquire OASYS Technology. Dana Petroleum proposed to buy certain assets of Petro-Canada UK for £240 million.

Stocks in Japan dropped as the yen continued to rise and the Bank of Japan cited modest economic recovery. Yen traded at the high last seen since May 1995. Core machinery orders and current account surplus surged in July. Toyota recalls continue and extend to Australia.

Stocks in China region fell after renewed sovereign debt concerns escalated in Europe. Yanzhou Coal plans to take 51% stake in Inner Mongolia-based coal miner. M&A loans rose to touch 10 billion yuan by the end of June in Shanghai.

Stocks in Mumbai fluctuated but closed higher at the end of the day. Basmati exports expected to go up due to floods in Pakistan. Gold price in Mumbai traded above record at Rs 19,000 for ten gram. Ohio State in the U.S. bans outsourcing of IT and back-office projects.

Stocks in Australia closed fractionally lower. Prime Minister Gillard commits to regional infrastructure plan worth A$800 million. Home approvals rose more than expected in July. Toyota recalls HiLux cars in Australia.

Commodities, Currencies and Yields

Dollar edged lower against euro to $1.276 and rose against the Japanese yen to 83.97.

Crude oil increased $0.55 to $74.64 a barrel for a front month contract, natural gas edged higher 0.16 cent to $3.92 per mBtu and gasoline increased 0.68 cents to 193.97 cents.

Gold decreased $1.70 in New York trading to close at $1,257.60 per ounce, silver increased $0.06 to $19.98 per ounce and copper for the front month delivery increased 2.25 cents to $3.49 per pound.

Yields on 10-year U.S. bonds decreased to 2.65% and on 30-year U.S. bonds yields edged down 3.72%.