Stocks in New York Advance on Housing Data, Euro Gains

Bikram Pandey
17 Oct, 2012
New York City

U.S. market extended gains in a worldwide rally after housing starts jumped 15% to a 4-year high. European markets gained after Spain avoided a rating decline and Japan inches towards another economic stimulus package.

[R]4:10 PM New York – U.S. market extended gains in a worldwide rally after housing starts jumped 15% to a 4-year high. European markets gained after Spain avoided a rating decline and Japan inches towards another economic stimulus package.[/R]

U.S. markets extended world gains and the euro advanced.

U.S. markets and stocks rose after housing starts surged 15% in September. The sharp gain in starts lifted stocks of home builders and do-it-yourself retailers and also provided positive tone to the market.

However, tech stocks were under pressure after Intel and IBM reported mixed earnings data and offered a cautious outlook for the current quarter. Bank of America also reported weak earnings and the railroad operator also declined on weak earnings.

Dean Foods ((DF)) soared 13% after it agreed to spin off its WhiteWave Foods Co in an initial public offering and raise as much as $320 million.

Apollo Group Inc ((APOL)) dropped 20% after the largest for-profit college forecasted 2013 revenues that were below expectations and said it plans to cut jobs and close campuses.

U.S. indexes traded sideways after housing starts surged to a four-year high in September but IBM and Intel reported weak earnings reports. Exxon Mobil Canada agreed to acquire Celtic for C$3.1 billion and HCP agreed to purchase 133 senior housing communities for $1.73 billion.

The European indexes rose and Moody''s confirmed Spanish bond rating but with a negative outlook. Hungary announced new austerity measures to curtail deficit.

Euro zone construction output climbed in August but German production fell 2.8%. Germany slashed its economic growth outlook for 2013 and investor confidence in Switzerland improved in October.

ASML agreed to acquire Cymer for €1.95 billion. Danone consolidated sales rose 9.4% to €5.26 billion and TeliaSonera earnings fell 1.2% in the third quarter. Credit Agricole agreed to sell the entire share capital of Emporiki group to Alpha Bank for €1.

The UK indexes advanced after unemployment rate fell unexpectedly in three months to August. Pearson agreed to acquire EmbanetCompass for $650 million. The Royal Bank of Scotland agreed to exit the government’s asset protection scheme.

Commodities, Bonds and Currencies

U.S. treasury yield on 10-year bond increased to 1.81% and on 30-year bond gained to 2.98%.

The U.S. dollar inched higher to $1.312 to a euro and increased against the Japanese yen to 78.98 yen.

Immediate delivery futures of Texas crude oil decreased 20 cents to $91.89 a barrel and Brent crude fell $1.1 to $112.90, futures of natural gas increased 0.02 cents to $3.47 per mbtu and gasoline traded down 6.99 cents to 277.54 cents a gallon.

In metals trading, copper increased 4.5 cents to $3.74 per pound, gold increased $3.00 to $1,749.30 per ounce and silver increased 22 cents to $33.15.