U.S. Indexes Turn Positive in 2011, Stocks in 4-day Rally

Bikram Pandey
23 Dec, 2011
New York City

U.S. stocks extended gains for the fourth day in a row and the popular indexes advanced to the positive in the year. Broader indexes gained 3.6% in the week and closed up 0.5% in the year. Tech heavy indexes added 2.4% in the week and still down in the year.

[R]4:00 PM New York – U.S. stocks extended gains for the fourth day in a row and the popular indexes advanced to the positive in the year. Broader indexes gained 3.6% in the week and closed up 0.5% in the year. Tech heavy indexes added 2.4% in the week and still down in the year.[/R]

U.S. stocks closed higher and extended gains for the fourth day and President Barack Obama signed into law a $1 trillion bill to fund most of the government spending till the end of the fiscal year to September.

The budget for the fiscal year also cut spending by 3% for the Environmental Protection Agency and by 2% for the International Revenue Service and by 6% the Government Accountability Office. The payroll tax cut was extended for two months by the House and the Senate and signed by the President hours later.

In economic news consumer spending rose 0.1% in November and core business spending declined even though the gross spending rose 3.8%.

European markets traded higher as benchmark indexes in France and German gained more than 1%. Italy approved the austerity measures that will increase taxes and extend retirement age and cut spending by €33 billion. European risk monitoring agency said downside risks in the euro zone are rising.

In Asian trading, markets in Japan were closed and stocks in Hong Kong closed higher and retained the positive bias in the last three days. The Hang Seng index increased 1.4% and for the week declined 1.9%. The cement maker China Tianrui soared 26% on its first day of trading in Shanghai.

Australian benchmark index increased more than 1% and for the week closed down 0.5%. Gloucester Coal received $2.2 billion merger offer from China based Yanzhou Coal. Retailers traded weak on the worries that the slump may extend next year.

Commodities, Bonds and Currencies

The yield on 10-year U.S. bond increased to 2.02% and 30-year bond inched up to 3.06%.

The U.S. dollar edged down 0.7% to $1.304 to one euro and traded higher against the Japanese yen to 78.05.

Immediate delivery futures of Texas crude oil increased $0.26 to $99.79 a barrel and futures of natural gas fell 6 cent to $3.10 per mbtu and gasoline price added 5.8 cents to 269.75 cents a gallon.

In metals trading, copper increased 4.5 cents to $3.46 per pound, gold decreased $3.40 to $1,607.20 per ounce and silver increased $0.06 to $29.10.