U.S. Retailers Power Market Rally; Oil, Copper Close Up

Bikram Pandey
02 Dec, 2010
New York City

U.S. stocks closed higher after same store sales rose more than expected in November. European markets closed higher after the ECB stepped up bonds buying and Spain completed the sale of

[R]4:00 PM New York – U.S. stocks closed higher after same store sales rose more than expected in November. European markets closed higher after the ECB stepped up bonds buying and Spain completed the sale of €2.5 billion at a higher yield. Crude oil and copper closed higher.[/R]

U.S. stocks traded higher after retail sales rose in November and the index of pending home sales surged 10%. The stronger than expected comparable sales in November at nation’s largest retail stores powered the rally and positive news from Europe also helped.

Of the 26 chain stores sales tracked by 123jump.com, only three chains reported a decline in comparable sale in November and the rest showed an increase between 0.4% and 9.5%.

Spain successfully raised nearly €2.5 billion selling three-year bonds. The European Central Bank held key rate at 1%. U.S. weekly jobless claims increased 26,000. PepsiCo agreed to acquire stake in Russia-based Wimm-Bill-Dann for $3.8 billion.

Costco said November comparable sales rose 9%. General Motors vehicle sales increased 11.4%. Kroger third quarter total sales soared 5.9% to $18.7 billion. Toll Brothers fourth quarter revenues declined 17.2% to $402.6 million.

The European indexes traded sideways after the European Central Bank retained liquidity measures and held key rate at 1%. Spain successfully raised nearly €2.5 billion selling 3-year bonds but the yields rose to 3.7% from 2.5% in the bond auction in October.

Euro area third quarter GDP expanded 1.9% and Swiss GDP rose 2.8% from a year ago. German economy expanded at 0.7% in the quarter and Greek economy contracted 1.1% from the second quarter.

The UK indexes rose after construction activity slowed in November. GlaxoSmithKline inched closer to acquire China-based Nanjing MeiRui Pharma. TUI Travel annual loss widened 65% as sales declined 3.2%.

Tokyo stocks surged the most in two weeks on positive U.S. economic data. Business investment in September quarter rises 5%, breaking a three-year losing streak. Tobacco Tax revenue surges 120% in October from a year earlier. Year-end bookings by tourists to China drop 50%.

Stocks in Shanghai and Hong Kong closed higher after U.S. private employers expanded employment in November and manufacturing expanded. Expectations ran higher that the United States may offer more capital to IMF to help ease European debt crisis. PetroChina plans to expand oil and gas network by 80%. Gold production in China surges 8.83%.

Stocks in Mumbai closed higher for the third day in a row tracking the gains in Asia and international markets. Whole price index showed a decline and food price inflation dropped to 18-month low. Azim Premji, the founder of Wipro Ltd set up a philanthropic trust with his personal assets of $1.9 billion.

Apollo Hospitals plans to sell 49% stake in its pharmacy chain. Hero Honda Group agreed to increase royalty payments to the parent company in Japan. Union Cabinet has approved ONGC stock split. UltraTech Cement November sales fell.

Sydney stocks surged nearly 2% on positive economic data from China and the U.S. Retail sales drops for the first time in eight months. Trade surplus in October was $2.625 billion.

Commodities, Currencies and Yields

Dollar edged down against euro to $1.32 and rose against the Japanese yen to 83.87. One UK pound fetched $1.5607.

Crude oil increased $1.24 to $87.90 a barrel for a front month contract, natural gas edged higher 6 cents to $4.32 per mBtu and gasoline increased 5.25 cents to 235.29 cents.

Gold decreased $2.40 in New York trading to close at $1,385.20 per ounce, silver increased $0.16 to $28.57 per ounce and copper for the front month delivery increased 2.55 cents to $3.97 per pound.

Yield on 10-year U.S. bond increased to 3.0% and on 30-year U.S. bond yield increased to 4.26%.