U.S. Indexes in 3-day Losses; Oil Falls 2%

Bikram Pandey
29 Mar, 2012
New York City

U.S. stocks eased for the third day in a row on the rising worries about inflated domestic market valuations and the health of the economy in the euro zone. Best Buy plans to shutter 50 stores and a Korea based company may bid for operator of Payless ShoeSource. Crude oil decreased 2%.

[R]4:35 PM New York – U.S. stocks eased for the third day in a row on the rising worries about inflated domestic market valuations and the health of the economy in the euro zone. Best Buy plans to shutter 50 stores and a Korea based company may bid for operator of Payless ShoeSource. Crude oil decreased 2%.[/R]

U.S. stocks fell for the third day in a row but are set to close the quarter as the best first quarter since April 1998 with the S&P 500 index up in the quarter so far 11.6%.

The sentiment was cautious despite the weekly jobless claims fell to a four year low and the estimate of the economic growth in the last quarter was held at 3%.

In corporate news, Best Buy Co. reported lower than expected quarterly loss and plans to close 50 U.S. stores as the largest independent electronics retailing chain faces competition from Wal-Mart Stores and online retailers.

Movado fourth quarter net income swung to $10.7 million. Mosaic declined after potash sales and third quarter net plunged to 64 cents a share from $1.21 a share a year ago.

Red Hat fourth quarter net grew 7.5% to $36 million and announced a stock buyback plan. Big Lots Inc dropped more than 5% on the worries that sales may not meet market expectations.

Health insurance companies soared for the third day in a row on the expectations that the U.S. Supreme Court will overturn several mandates of the healthcare reform that may benefit the industry. Aetna Inc gained 6% and UnitedHealth Group Inc added 4.5%

The initial public offering of online personalized goods seller Cafepress Inc jumped more than 20% after it priced 4.5 million shares at $19 each. The acquisitive online personalized marketplace operator has steadily grown its revenues but earnings have stagnated in the last three years.

European indexes edged lower and the euro area sentiment, German jobless rate and UK home prices dropped in March. The number of mortgage approvals in the UK fell in February. Spanish strike paralyzed the nation and Italy sold €8 billion in debt.

The benchmark index in Tokyo declined for the second day and extended two-day losses to 1.5%. Foreign investors cut stock positions last week after adding for twelve weeks in a row. Sharp advanced for the second day after it sold a stake to Taiwan based Hon Hai Precision.

Australian stocks eased as investors shifted focus to international markets and the dollar eased. Leighton Holdings cuts its annual profit outlook on cost overruns at two key projects in Australia.

Commodities, Bonds and Currencies

The yields on 10-year U.S. bond decreased to 2.17% and 30-year U.S. bond edged lower to 3.27%.

The U.S. dollar edged up to $1.329 to one euro and eased against the Japanese yen to 82.44 yen in New York trading.

Immediate delivery futures of Texas crude oil decreased $2.24 to $103.17 a barrel and Brent crude futures fell $1.69 to $122.47. Futures of natural gas decreased 0.12 cents to $2.16 per mbtu and gasoline price rose 0.37 cents to 339.92 cents a gallon.

In metals trading, copper rose 1.95 cents to $3.81 per pound, gold added $2.30 to $1,662.80 per ounce and silver gained 40 cents to $32.35.