U.S. Indexes Flat Ahead of Election; Dollar, Oil, Gold Inch Higher

Barry Randall
05 Nov, 2012
New York City

Stocks on Wall Street hugged flat line ahead of the U.S. presidential election tomorrow and voter turnout is ahead of expectations in key swing states of Florida, Colorado and Ohio. The dollar, gold and crude oil traded higher.

[R]4:00 PM, New York – Stocks on Wall Street hugged flat line ahead of the U.S. presidential election tomorrow and voter turnout is ahead of expectations in key swing states of Florida, Colorado and Ohio. The dollar, gold and crude oil traded higher.[/R]

U.S. indexes barely budged and traded in a tight range ahead of presidential election and ongoing uncertainties in the euro zone.

U.S. is heading for sharp spending cuts of as much as $600 billion beginning 2013 and increase in taxes after a bi-partisan commission failed to agree on a plan that kicked in automatic tax increase in spending cuts.

On merger Monday, Malaysia-based SapuraKencana and Seadrill agreed to integrate tender rig businesses in a $2.9 billion deal. Humana agreed to acquire Metropolitan for $850 million.

Service industry index declined to 54.2 from 55.1 in September, according to the latest data released by the Institute of Supply Management.

In the earnings news, Church & Dwight third quarter net jumped 18%. Humana third quarter net declined 4% but lifted outlooks and agreed to buy Metropolitan Health for $850 million and also agreed to acquire Certify Data Systems. Time Warner net surged 127% but also lost 140,000 video subscribers, more than estimated.

McGraw Hill Cos ((MHP)) dropped 5% after the company lost a lawsuit in Australia and the judge ordered that the company’s ratings misled investors after awarding its highest rating to securities that plunged later.

Apple Inc ((AAPL)) gained 0.7% after the company said it sold 3 million iPad fourth version and mini units in more than 30 countries including the U.S. during this weekend. The demand for the mini version of the unit outstripped the supply, according to the company.

The European indexes edged lower ahead of the U.S. presidential election and Communist Party meeting this week in China. The euro edged higher and resources stocks and banks were under pressure.

Euro zone confidence improved in November. Spanish unemployment rose more than estimated and Hungarian manufacturing activity worsened in October.

In corporate news in Europe, QSC revenue fell and Transocean net loss widened in the third quarter. Fuchs estimates higher earnings and revenues for full-year. Ryanair first-half net rose 10% to €596 million. AXA completes acquisition of HSBC P&C operations in Hong Kong and Singapore.

The UK indexes declined tracking lower world markets and UK government gross reserves rose and services sector grew marginally in October. HSBC third quarter underlying pretax profit surged 125% to $5.04 billion.

Stocks in Tokyo halted a 3-day rally on a weakness in regional trading and commodities prices declined. Utilities closed lower after regulators delayed a decision to reopen nuclear power plant. Toyota lifted its annual net profit outlook after the close.

Australian stocks closed higher on the expectations of a rate cut after the central bank meeting on Tuesday. Australian trade deficit narrowed in September after imports fell more than exports. Seasonally adjusted retail sales in the month declined 0.5%.

Commodities, Bonds and Currencies

U.S. treasury yield on 10-year bond decreased to 1.68% and on 30-year bond fell to 2.87%.

The U.S. dollar inched higher to $1.273 to a euro and increased against the Japanese yen to 80.26 yen.

Immediate delivery futures of Texas crude oil increased $0.93 to $85.76 a barrel and Brent crude rose $2.40 to $108.08, futures of natural gas increased 0.01 cents to $3.56 per mbtu and gasoline traded up 5.1 cents to 262.46 cents a gallon.

In metals trading, copper decreased 0.40 cents to $3.47 per pound, gold increased $9.00 to $1,684.20 per ounce and silver increased $0.32 to $31.17.