U.S. Stocks, Bonds Advance; Dollar Eases

Bikram Pandey
18 Oct, 2010
New York City

U.S. stocks and bonds closed higher and industrial output in September declined unexpectedly. The dollar declined against the yen and the euro and gold and silver closed higher. Banks in the U.S. and Europe closed higher after Citigroup reported better than expected earnings. UK proposed military budget cuts for the next three years.

[R]4:00 PM New York – U.S. stocks and bonds closed higher and industrial output in September declined unexpectedly. The dollar declined against the yen and the euro and gold and silver closed higher. Banks in the U.S. and Europe closed higher after Citigroup reported better than expected earnings. UK proposed military budget cuts for the next three years.[/R]

U.S. stocks advanced after industrial output in September declined unexpectedly. Technology and banks traded higher. The dollar decline against the euro and the yen and gold and silver closed higher. Crude oil closed higher after falling three days.

Citigroup added more than 5.5% after it reported better than expected earnings. Haliburton Company dropped more than 4% after the quarterly earnings surged 108%. New Oriental Education & Technology Group Inc rose as much as 4% after revenues increased 29%.

The European indexes advanced after Citigroup reported better than expected earnings and Bundesbank forecasted German GDP growth to exceed 3% in 2010. Trichet rejected calls to scrap ECB bond buying. Italy current account deficit rose in August.

The UK indexes gained after home prices surged 3.1% in October. The CEBR forecasted the BoE will expand bond buying program by £100 billion. BP agreed to sell Venezuela and Vietnam businesses to TNK-BP for $1.8 billion. Royal Bank of Canada agreed to acquire BlueBay agreed for $1.5 billion.

Stocks in Japan closed nearly unchanged and the yen traded at elevated level. Department stores sales fell in September for the 31st month in a row. Japanese oil firm Inpex drops its Iran project in order to pursue energy development plans in Australia and other regions.

In the absence of global events and local economic news stocks declined in Shanghai and Hong Kong. China’s direct investments in overseas markets jump 10% for the first nine months of the year. Fiscal revenue of China rose 12% in September from a year ago. Private equity firms invest in more companies in the third quarter of this year.

Stocks in Mumbai recovered from the early fall as the Coal India offering receives more than thirty percent of subscription. World’s largest diamond bourse starts in Mumbai. ArcelorMital halves the proposed investment in Jharkhand steel plant complex. ONGC makes two new oil and gas discoveries.

Larsen & Toubro increased more than 1% after its second quarter net from operations increased 19.6%. Godrej Properties declined 3.6% after quarterly net fell 26.4%. HDFC Bank second quarter net surged 21.6%.

Commodities, Bonds and Currencies

Yields on 10-year bond decreased to 2.51% and on 30-year bonds declined to 3.95%.

The U.S. dollar decreased to $1.397 to a euro and rose against the Japanese yen to 81.19 yen.

Immediate futures prices of Texas crude oil decreased $1.42 to $81.27 a barrel, for natural gas fell 0.11 cents to $3.41 per mbtu and gasoline prices increased 4.44 cents to 215.38 cents a gallon.

In metals trading, copper prices increased 3.85 cents to $3.87 per pound, gold increased $3.20 to $1,375.20 per ounce and silver rose 20 cents to $24.49.