Nasdaq Gains 3%, Silver, Gold Near Records

Bikram Pandey
17 Sep, 2010
New York City

U.S. stocks traded sideways as commodities continued to advance. The Dow gained 1.2% and the S&P 500 index added 1.4%. The Nasdaq advanced 3.2% in the week. Resource and technology stocks closed higher in the week. Silver inched near 30-year high and gold traded intra-day record.

[R]4:00 PM New York – U.S. stocks traded sideways as commodities continued to advance. The Dow gained 1.2% and the S&P 500 index added 1.4%. The Nasdaq advanced 3.2% in the week. Resource and technology stocks closed higher in the week. Silver inched near 30-year high and gold traded intra-day record.[/R]

Precious metals have been on the rise despite benign inflation but the fears of high debt and unstable election environment and threat of sovereign default in Europe contributed to the spike in metals market.

Gold futures for December delivery increased and traded at intra-day record $1,284.40 and silver inched higher near $20.80 but below record $21.44 in 1980. For the year, gold rose 16% and silver has gained 23%.

U.S. stocks gained after consumer prices rose 0.3% in August. The U.S. Senate approved small business bill. J&J negotiated to buy rest of Crucell shares for €24.75 per share. Oracle quarterly net increased 20% and Research in Motion net soared 68%.

Crucell NV soared after the company is in talks with J&J. Research in Motion surged after it reported better than expected sales and earnings. Texas Instruments gained after it increased dividend and offered to buy back up to $7.5 billion in shares.

The UK indexes declined on global economic data. The UK Chancellor George Osborne reiterated sovereign debt risk is a threat to European economies. Promethean Plc surged 6.33% to 42.00 pence after the investment company reported fiscal 2010 profit.

The European indexes fell after euro area current account deficit remained flat and construction output fell in July. German PPI rose 3.2% in August. Carrefour SA surged 5% after the retail giant plans to invest about €1.5 billion in hypermarkets.

Stocks in Japan added more than 1% on Friday and gained 4% in the week and surged more than 9% in the month. The yen declined to five-week low against the dollar and the euro. Prime Minister Kan announced a new cabinet. Crude steel output rises in August, the tenth consecutive month of increase.

Stocks in Shanghai treaded marginally lower but the weekly drop was the steepest in more than two months. Hong Kong index gained 1% and for the week added 3.3% and surged more than 7% in the month. Four Taiwan-based banks get permission to open mainland branches.

The Sensex index closed higher and jumped 4% and surged more than 7% in the month. Rupee advanced. Sustained foreign investments and rising consumer confidence has lifted index at the fastest pace in last four months. State Bank of India looks to raise more than $4.5 billion.

Stocks in Australia rallied and closed higher for the third week in a row. The weekly gain of 1.7% completes the rise of more than 8% in less than three weeks. Asciano Group raised $1 billion to repay bank loans. Santos secures funds for its Gladstone LNG project.

Commodities, Currencies and Yields

Dollar edged lower against euro to $1.304 and fell against the Japanese yen to 85.80. One UK pound fetched $1.5662.

Crude oil decreased $0.97 to $73.60 a barrel for a front month contract, natural gas edged lower 0.50 cent to $4.01 per mBtu and gasoline decreased 0.52 cents to 191.95 cents.

Gold increased $4.30 in New York trading to close at $1,278.10 per ounce, silver added $0.07 to $20.84 per ounce and copper for the front month delivery increased 3.15 cents to $3.52 per pound.

Yields on 10-year U.S. bonds decreased to 2.74% and on 30-year U.S. bonds yields edged down 3.91%.