U.S. Stocks Fall on Retail Sales Data; Deutsche Boerse, NYSE Agree to Merge

Bikram Pandey
15 Feb, 2011
New York City

U.S. stocks fell after retail sales rose less than expected in January and import prices rose 1.5%. Deutsche Boerse and NYSE Euronext agreed to merge that will create world�s largest network of equities and futures exchanges. Euro-zone sets up a permanent bailout fund. China inflation worries Asia.

[R]4:00 PM New York � U.S. stocks declined after retail sales rose less than expected in January and import prices rose 1.5%. Deutsche Boerse and NYSE Euronext agreed to merge that will create world�s largest network of equities and futures exchanges. Euro-zone sets up a permanent bailout fund. China inflation worries Asian markets.[/R]

U.S. indexes traded lower after retail sales rose 0.3% in January, the smallest increase for last seven months when sales declined in June and import prices increased 1.5%.

Deutsche Boerse and NYSE Euronext agreed to merge in which Germany based exchanges operator will own 60% stake and New York based exchange operator will control 40%. The Deutsche Boerse AG�s $9.5 billion purchase will create the world�s largest owner of stock exchanges with $15 trillion in market cap and derivative markets.

Berkshire Hathaway sold stake in eight companies including Bank of America and Nike. Ventana accepted Batista''s offer. OECD jobless rate declined in December. Chevron plans to appeal adverse Ecuador ruling that may cost as much as $16 billion.

Agilent first quarter net income surged 144% to $193 million. FedEx lowered earnings guidance. HCP fourth quarter net income increased to $136.2 million. Qwest Communications swings to a net loss of $161 million. Sirius reported fourth quarter net loss.

The European indexes rose after weaker-than-expected domestic economic growth data. Euro-zone finance ministers agreed to set up a permanent sovereign bailout fund for the region of �500 billion. Euro area trade deficit narrowed. Riksbank hiked key rate again.

The UK indexes fell after the Bank of England Governor Mervyn King warned inflation likely to increase further and home prices rose. January inflation rose at twice the rate set by the central bank. UK Commercial Property acquired. Barclays Plc net nearly triples.

Stocks in Japan traded higher as on earnings optimism and shifting fund flows to the developed markets. GS Yuasa rose after it lifted its earnings outlook but Yamaha plunged 11% after it estimated lower than expected earnings.

Stocks in Shanghai closed flat and in Hong Kong declined on the worries that more rate tightening may be needed to cool inflation. The January inflation index rose 4.9%, less than expected on the change in index weights on fast rising food prices. Cement makers gained on higher demand expectations.

Mumbai stocks extended gains for the third day and rebounded 4.5%. The Sensex index has declined 15% form the peak in the first week in January. LIC Housing surged after a government controlled fund resumed investing. Tata Motors global sales rose 16% in January. Reliance MediaWorks loss widens.

Australian stocks closed nearly unchanged and the Australian dollar rose to a 9-month high against the yen. Brambles declined after it reported lower than expected earnings. Westpac gained after quarterly net fell but interest margin rose. The RBA statement confirmed the above trend growth and tightening bias.

Commodities, Bonds and Currencies

Yield on 10-year bond was unchanged at 3.60% and on 30-year bond at 4.66%.

The U.S. dollar decreased to $1.345 to a euro and rose against the Japanese yen to 83.85 yen.

Immediate futures prices of Texas crude oil decreased $0.54 to $84.26 a barrel, for natural gas rose 0.05 cents to $3.98 per mbtu and gasoline prices decreased 3.50 cents to 248.24 cents a gallon.

Brent crude oil futures of immediate month delivery fell $1.39 to $101.69 a barrel.

In metals trading, copper prices decreased 9.06 cents to $4.52 per pound, gold increased $10.20 to $1,375.30 per ounce and silver rose 22 cents to $30.75.