World Markets Sideways; U.S. Home Prices at 9-year Low

Bikram Pandey
28 Feb, 2012
New York City

Tech stocks advanced and commodities gained as U.S. indexes gained a fraction. European markets were cautious as banks prepare to participate in the second extended loan program. Japan based Elpida Memory filed bankruptcy protection and the dollar edged lower against the euro.

[R]4:00 PM New York – Tech stocks advanced and commodities gained as U.S. indexes edged up. Metropolitan home prices fell to another low. European markets were cautious as banks prepare to participate in the second loan program. Japan based Elpida Memory filed bankruptcy protection and the dollar edged lower against the euro.[/R]

U.S. stocks traded sideways after durable goods orders fell in January at the sharpest pace in three years on weaker than expected demands for aircrafts and business equipment. Consumer confidence increased in February.

However, the market sentiment was positive in the tech sector as Apple Inc prepared to release its third generation of popular tablet computer on March 7. Apple extended gains for the fourth day in a row.

A private survey that tracked home prices in top 20 metropolitan cities declined in December by 1.1%. For the year, the S&P 500 Case-Shiller index fell 4% and the index dropped to the low last seen in February 2003 and is now down 34% from the peak. Home prices fell in every city except Phoenix and Miami and home prices in Atlanta, Las Vegas, Seattle and Tamp declined to record lows.

Earnings were also in focus Priceline.com soared on quarterly results and said it will expand to more emerging markets. Cooper Tire settled a 3-month strike. AutoZone second quarter net increased 13% to $166.9 million. Bank of Montreal first quarter net soared 34% to $1.10 billion. Ecolab fourth quarter net declined 32% to $88.7 million. Sempra Energy fourth quarter net increased to $292 million.

Private and online education companies were on the decline after Apollo Group Inc lowered its operating earnings outlook for the current year. DeVry Inc, ITT Educational Services declined more than 5% and Apollo plunged 12%.

Chipmaker Micron Technology Inc increased 6% after the company said it will make and sell Intel designed products based on a technology called Nand flash memory. The move is expected expand company sales into wireless devices that are growing rapidly.

European markets closed mixed and Greece kicked off its debt swap program with private holders. Portugal said it passed third check from troika and is not looking for more debt or more time to pay the current debt. Italian debt yields dropped to a 9-mnth low.

Stocks in Tokyo trading closed higher reversing earlier losses in the day after the largest PC chipmaker Elpida Memory Inc filed for a bankruptcy protection with $5.6 billion in debt. Shipping companies declined for the second day in a row.

Australian stocks edged lower for the second day and resource prices stayed elevated. QBE Insurance said it will raise capital in a rights offering after annual net plunged by half. Goodman Fielder soared on a takeover speculation.

Commodities, Bonds and Currencies

The yield on 10-year U.S. bond was unchanged at 1.92% and 30-year bond edged higher to 3.04%.

The U.S. dollar traded down 0.4% to $1.345 to one euro and edged up against the Japanese yen at 80.481.

Immediate delivery futures of Texas crude oil decreased 50 cents to $108.06 a barrel and Brent crude declined $1.30 to $122.87.

Futures of natural gas fell 7 cents to $2.53 per mbtu and gasoline price decreased 5.7 cents to 307.13 cents a gallon in New York trading.

In metals trading, copper increased 2.80 cents to $3.91 per pound, gold increased $15.20 to $1,790.10 per ounce and silver increased $1.51 to $37.11.