S&P 500 Index Barely Positive, European Markets Near Bear Zone

Bikram Pandey
27 Dec, 2011
New York City

U.S. stocks traded sideways as world markets rested after a tumultuous year. The nine-month period to the year-end was one of the most volatile times in global markets in the last three as the euro zone crisis raged and sovereign debt yields soared. Oil closed above $100 a barrel.

[R]4:00 PM New York – U.S. stocks traded sideways as world markets rested after a tumultuous year. The nine-month period to the year-end was one of the most volatile times in global markets in the last three as the euro zone crisis raged and sovereign debt yields soared. Oil closed above $100 a barrel.[/R]

The U.S. indexes traded lower after home prices declined 3.4% and consumer confidence rose to an eight month high. Stocks rose a fraction today after the S&P 500 index rose 3.7% last week and a three-day holiday weekend.

The broad measure of the market, the S&P 500 index gained 0.6% in the year so far, smallest increase in at least three decades. The volatile market led the index to a daily swing of more than 2% for more than two weeks in August in one of the most volatile periods between April and the year end in the last three years.

In Paris trading, the CAC-40 Index gained 13.20 or 0.4% to 3,115.24 and in Frankfurt the DAX Index edged higher 24.87 or 0.4% to 5,903.69 and markets in UK are closed to celebrate the Boxing Day.

For the year, CAC-40 index is down 18% and the DAX30 index has fallen 14.6%.

Italian bond jumped above 7% ahead of last debt auction this Friday. Sony agreed to sell its 50% stake in LCD joint venture to Samsung for $940 million.

European markets edged higher. The European Central Bank allotted €144.755 billion in 7-day tender. France jobless rate rose to a 12-year high in November. France Telecom agreed to sell Orange Communication to Apax Partners for €1.6 billion.

Stocks in Japan edged lower and the trading sentiment remained weak. Market volume was the lowest in the year and the weakest at least in seven years as international markets grind to a halt. Tepco may have to give up control of the company to receive government aid.

Commodities, Bonds and Currencies

The yield on 10-year U.S. bond decreased to 2% and 30-year bond inched down to 3.03%.

The U.S. dollar edged down 0.5% to $1.306 to one euro and traded lower against the Japanese yen to 77.86.

Immediate delivery futures of Texas crude oil increased $1.64 to $101.32 a barrel and futures of natural gas rose 7 cent to $3.12 per mbtu and gasoline price fell 7.4 cents to 267.98 cents a gallon.

In metals trading, copper decreased 5.5 cents to $3.41 per pound, gold decreased $11.30 to $1,594.70 per ounce and silver decreased $0.40 to $28.68.