Jobs Report Lift Wall Street Sentiment; Greek CDS Triggered

Bikram Pandey
09 Mar, 2012
New York City

U.S. stocks advanced and broader indexes are set to extend gains for the fourth week in a row. Greece

[R]4:15 PM New York – U.S. stocks advanced and broader indexes are set to extend gains for the fourth week in a row. Greece’s landmark bond swap deal with 86% participation triggered $3 billion in credit default swaps. China’s inflation eased to a 20-month low.[/R]

U.S. and global indexes rose after Greece successfully completed the landmark bond swap deal. The U.S. trade deficit widened in January and non-farm payrolls rose in February.

In corporate news, Copper Companies, Inc soared 4% after the contact lenses and medical products maker reported first fiscal quarter earnings increased 39%. Boston Scientific Corp agreed to acquire Cameron Health Inc for $150 million in upfront payment and $150 million over a six year period. Molycorp agreed to acquire Canada-based Neo Material in $1.3 billion deal.

Anadarko Petroleum Corp surged 4% after the company finalized its agreement with Algeria government that will increase the release of crude oil volume in the next twelve months worth $1.8 billion and will increase its stake in the joint venture that was estimated at $2.6 billion based on the current oil prices.

Ann Inc. fourth quarter net slumped 73% to $2.18 million and full year sales were in-line with expectation. Aeropostale fourth quarter net declined 69% to $26.1 million on higher raw materials costs.

European indexes edged slightly higher after Greece successfully completed the landmark bond swap deal that attracted nearly 86% of private bond holders.

The International Swaps & Derivatives Association said that Greece’s use of collective action clauses will trigger the default insurance. The decision will now permit the settlement of 4,323 credit default swap contracts with payouts of $3 billion.

German annual inflation increased but Greek inflation eased in February. German manufacturing index increased 0.4% in January. The Portuguese and Greek economy contracted in the fourth quarter. French production rose but Italian output and Spanish retail sales fell in January.

The UK indexes climbed after Greece attracted 86% participation in debt swap. The UK construction output fell in January and production and orders improved in the first quarter. LSE agreed to acquire a majority stake in LCH.Clearnet for £386 million.

Stocks in Tokyo advanced for the second day in a row after China reported easing of inflation and Greece debt swap attracted higher than expected participation. Steelmakers and infrastructure stocks led the gainers. The yen traded near 9-month high.

The current account balance in Australia swung to a deficit of $673 million on weaker than expected exports. Insurer Australia Group said it plans to cut 600 jobs in the next three years. Qantas dropped its plan to set up a premium airline in Asia.

Commodities, Bonds and Currencies

The yield on 10-year U.S. bond edged up to 2.03% and 30-year bond edged higher to 3.19%.

The U.S. dollar traded up 1.1% to $1.3117 to one euro and edged up against the Japanese yen at 82.38.

Immediate delivery futures of Texas crude oil increased 86 cents to $107.44 a barrel and Brent crude rose 61 cents to $126.04.

Futures of natural gas increased 0.5 to $2.321 per mbtu and gasoline price increased 2.4 cents to 333.84 cents a gallon in New York trading.

In metals trading, copper increased 5.8 cents to $3.84 per pound, gold increased $13.00 to $1,711.70 per ounce and silver increased 42 cents to $34.27.