World Stocks Struggle; U.S. Foreclosures to Surge

Bikram Pandey
13 Jan, 2011
New York City

U.S. stocks declined after an unexpected rise in weekly jobless claims and a rise in wholesale prices. Foreclosures increased only 2% in 2010 but are expected surge in the year as banks streamline the process and meet legal requirements. California led the nation in filings with 14% share.

[R]4:00 PM New York – U.S. stocks declined after an unexpected rise in weekly jobless claims and a rise in wholesale prices. Foreclosures increased only 2% in 2010 but are expected surge in the year as banks streamline the process and meet legal requirements. California led the nation in filings with 14% share.[/R]

U.S. stocks fell after weekly jobless claims surged the most in six months but continuing claims declined to 3.88 million from 4.13 million. Producer prices rose more than estimated and trade deficit unexpectedly narrowed to $38.3 billion in November from $38.4 billion revised in October and to 10-month low.

U.S. foreclosure filings rose 2% in 2010 to 2.87 million and are expected to surge as much as 20% according to a research firm. Five states, California, Florida and Arizona, Illinois and Michigan accounted with 51% of filings according to Realtytrac Inc.

Infosys Technologies third quarter revenues increased 28% to $1.6 billion and Marathon Oil surged after plan to spin-off downstream business in to two independent companies. Starbucks Corp entered into an alliance with Tata Group of India to source coffee and look for ways to open retail location in the nation.

The European indexes rose after successful bond auction by Spain and Italy and spreads with German bonds declined.

The ECB left key rate unchanged at 1% and the euro gained on the comments from the ECB President Jean-Claude Trichet that inflationary pressures are on the rise in the short run.

German wholesale and French consumer prices rose in December. Dutch retail sales surged in November. Greek jobless rate climbed in October.

The UK indexes slid after the Bank of England held key rate at 0.5% and bond buying program at £200 billion. The UK industrial production slowed in November. Retailer Morrisons agreed to acquire 16 Netto UK stores from Asda for £28.1 million.

Japanese stocks rallied for the fifth day in a row led by bankers and closed at 8-month high. The Nikkei index is up 16% in the last three months. Prime Minister Naoto Kan plans to reshuffle his cabinet on Friday. Machinery orders fall for the third month in a row in November.

Shanghai stocks rally led by oil refiners and airlines on rising yuan and crude oil price. Property developers’ sale rise despite tighter lending conditions. Poly Real Estate said 2010 contract sales soared 53% and Gemdale Corp sales rose 22%. Banks in Shanghai loan disbursements declined 9%.

Stocks in Mumbai fell 1.8% as the latest wholesale inflation price index increased 0.3%. IndiGo placed a $15.6 billion order for 180 Airbus 320 to be delivered between 2016 and 2025. Abhijeet Power plans Rs 1,500 crore IPO in February.

Stocks in Sydney posted the largest one-day gain in 2011 as flood waters abate and record jobs data. QR National plans to open next week, the Blackwater Coal line used by BHP and Rio Tinto. Santos confirms its investment of $16 billion in Gladstone LNG project in Queensland.

Commodities, Currencies and Yields

Dollar declined against euro to $1.334 and rose against the Japanese yen to 82.81. One UK pound fetched $1.58.

Crude oil decreased $0.61 to $91.25 a barrel for a front month contract, natural gas edged lower 0.13 cents to $4.38 per mBtu and gasoline decreased 1.87 cents to 244.44 cents.

Gold decreased $15 in New York trading to close at $1,370.80 per ounce, silver increased $0.92 to $28.62 per ounce and copper for the front month delivery decreased 5.75 cents to $4.35 per pound.

Yield on 10-year U.S. bond decreased to 3.0% and on 30-year U.S. bond yield fell to 4.49%.