U.S. Stocks Fall On New Greek Worries; Oil Halts 3-day Rally

Nichole Harper
10 Feb, 2012
New York City

U.S indexes dropped 1% as investors were on the defensive as Greek debt talks reach next hurdle. Crude oil halted 3-day rally and commodities declined on the economic worries. LinkedIn jumped 9% after net income soared 30%.

[R]11:45 AM New York – U.S indexes dropped 1% as investors were on the defensive as Greek debt talks reach next hurdle. Crude oil halted 3-day rally and commodities declined on the economic worries. LinkedIn jumped 9% after net income soared 30%.[/R]

U.S. stocks declined after two hours of trading as Greek saga takes a new turn and euro zone ministers raise stakes for the next bailout tranche release.

In a broad decline that dragged market indexes lower more than 1% and commodities fell more than 1%. Crude oil halted its three days rally and copper and gold trimmed prices.

Oil Imports and China Trade Drive Deficit

The U.S. trade deficit in December surged to $48.8 billion as imports rose and deficit with China accelerated. The deficit increased from the revised $47.1 billion in November.

For the year 2011, trade deficit increased 11.6% to $558 billion, record high since 2008 according to the data released by the Commerce Department.

Exports in the year increased 14.5% to $2.1 trillion and imports gained 13.8% to $2.7 trillion. In the year, import oil price averaged to record $99.78 a barrel and auto imports surged to the highest level since 2007.

The closely watched trade deficit with China jumped as imports surged to a record high. Exports to China soared 13.1% to $103.9 billion and imports increased 9.4% to $399.3 billion with deficit in the year soaring to $295.5 billion.

European Markets Fall on Greek Delays

European markets declined today and for the week as early enthusiasm faded after euro zone finance minister attached more conditions before the release of bailout funds.

Jean-Claude Juncker chair of the Eurogroup said Greek parliament must approve the agreement this weekend, three political parties must back the implementation of the reforms and Greek government must find additional cost cuts of €325 million.

Crude Oil Declines

Crude oil traded lower for the first time after rallying for three days in New York and rising for eight days in London after the International Energy Agency lowered its outlook.

In its monthly report, the agency lifted its estimate for 2012 demand growth to less than 1% and lowered its forecast by 250,000 barrels a day to 800,000 barrels a day.

Stock Movers

Alcatel Lucent soared 14% after it reported its first annual income since the merger of two companies in 2006.

Barclays gained 3% to 240.31 pence after the London based bank said it plans to cut 2 billion pounds of expenses by 2013 and limit the revenues set aside for bonuses to 32% from the previous high of 50%. The pretax profit declined 3% from a year ago to 5.9 billion pounds.

Full year profit attributable to shareholders declined to 3 billion pounds from 3.56 billion pounds in 2010. The bank reported stronger performance at its British retail and corporate units against the weak performance at its investment banking unit.

In the last quarter net income declined 19% from the previous quarter to 1.8 billion pounds.

Calpine Corporation ((CPN)) rose 6 cents to $15.45 after the power company reported fourth quarter revenue flat to $1.46 billion from $1.47 million in the same quarter last year.

Net loss in the quarter narrowed to $13 million or 3 cents per diluted share compared to $24 million or 5 cents per diluted share in the year ago earlier.

FLIR Systems, Inc. ((FLIR)) decreased 1.9% or 49 cents to $25.25 after the sensor system maker reported fourth quarter revenue fell 7% to $405.2 million from $437.5 million in the same quarter last year.

Net earnings in the quarter increased to $76.1 million or 48 cents per diluted share compared to $69.8 million or 43 cents per diluted share in the year ago period.

PPL Corporation ((PPL)) rose 23 cents to $27.94 after the energy and utility holding company reported fourth quarter total revenue surged to $4.22 billion from $1.86 billion in the same quarter last year.

Net income in the quarter increased to $401 million or 69 cents per diluted share compared to $355 million or 73 cents per diluted share in the year ago.

LinkedIn Corporation ((LNKD)) soared 11.4% or $8.71 to $85.10 after the online professional identity network operator reported fourth quarter revenue surged 105% to $167.7 million from $81.7 million in the same quarter last year.

Net income in the quarter increased to $6.9 million or 6 cents per diluted share compared to $5.3 million or 3 cents per diluted share in the year ago earlier.