U.S. Stocks Rest, Zipcar Soars 75%; Lawmakers Pass Budget Cuts

Bikram Pandey
14 Apr, 2011
New York City

U.S. stocks traded sideways as the lawmakers pass the budget cuts agreed with the President Obama. Zipcar soared 75% on its first day of trading as investors support seven public offerings that are expected to raise $1.9 billion. Glencore prepares for a dual-listing that may raise $11 billion.

[R]4:10 PM New York – U.S. stocks traded sideways as the lawmakers pass the budget cuts agreed with the President Obama. Zipcar soared 75% on its first day of trading as investors support seven public offerings that are expected to raise $1.9 billion. Glencore prepares for a dual listing that may raise as much as $11 billion.[/R]

The U.S. indexes struggled after weekly jobless claims rose 27,000 to 412,000. U.S. producer prices climbed less than anticipated and foreclosure filings dropped in March and the first quarter.

U.S. House passed the legislation to cut $38.5 billion as agreed with the President Barack Obama which is expected to sail through the Senate later the day. With 260-167 vote the House passed the legislation that will enact record government spending cuts including funding for law enforcement, National institute for Health and the Environmental Protection Agency.

Zipcar, Arcos Dorados Holdings Inc, Box Ships Inc and TMS International Corp managed to complete offerings today in a week that is scheduled to raise $1.9 billion from seven companies in New York. Zipcar surged 75% on its first day of trading.

The European indexes declined on rising commodity prices. Glencore is expected to raise as much as $11 billion in a dual listing in London and Hong Kong. Danone quarterly sales rose 19% and Roche reported group net sales declined 9%.

The UK indexes slid on concerns of inflation. UK consumer confidence improved in March. The Irish economy is forecasted to grow in 2011. WH Smith surged after first-half pre-tax profit rose 3.2%.

Stocks in Tokyo edged lower as investors face a daunting task of assessing the production losses across several industries. 123jump.com survey conducted in last two weeks suggested production loss of as much as 15%. Foreigners added $4.6 billion of net new stocks in the first week of current fiscal year.

Stocks in Hong Kong and Shanghai rested ahead of inflation data tomorrow. A surge in inflation in March is expected to surpass 5% increase, ahead of government target. Hong Kong residential prices cross the previous peak in 1997 on low interest rates.

Australian stocks declined ahead of G-20 finance meeting and China economic data. Several mining companies announced or completed fund raising totaling $250 million. NRW Holdings estimated 2011 sales to increased 15% but earnings will be at the lower end of the estimates.

Commodities, Bonds and Currencies

The 10-year bond yield increased to 3.49% and 30-year bond unchanged to 4.54%.

The U.S. dollar decreased to $1.4449 to a euro and rose against the Japanese yen to 83.42 yen.

Immediate delivery futures of Texas crude oil increased $1.30 to $108.41 a barrel, of natural gas increased 0.08 cents to $4.22 per mbtu and gasoline prices decreased 0.10 cents to 323.14 cents a gallon.

In metals trading, copper prices decreased 0.3 cents to $4.32 per pound, gold increased $18.70 to $1,474.30 per ounce and silver increased $1.74 to $41.99.