Market Updates

U.S. Stocks and Euro at 2-month Low

Bikram Pandey
08 Nov, 2012
New York City

    U.S. indexes extended losses and trimmed annual gain to 10% as lawmakers prepare for tough budget negotiations and European nations struggle to reign debts. Apple Inc dropped 23% below from its peak as competition heats up in tablet market.

[R]4:00 PM, New York – U.S. indexes extended losses and trimmed annual gain to 10% as lawmakers prepare for tough budget negotiations and European nations struggle to reign debts. Apple Inc dropped 23% below from its peak as competition heats up in tablet market.[/R]

U.S. indexes extended losses for the second day and dropped to the lows last seen in August. Trade deficit fell in September to a 2-year low and jobless claims fell unexpectedly by 8,000 to 355,000 after the Superstorm Sandy disrupted businesses and distorted data. Wendy''s third quarter loss widened.

On the earnings front, Duke Energy third quarter net climbed 26% and lifted outlook. Dean Foods quarterly net swung to $36.4 million profit and FirstEnergy net jumped 20% but narrowed guidance. Kohl’s lifted outlook and quarterly net rose. Qualcomm third quarter net jumped 20%.

In stock trading, McDonald’s ((MCD)) dropped 1.5% after same store sales declined 1.8% in October as traffic in U.S. stores declined. Apple Inc ((AAPL)) declined 3% and extended slump 23% from the peak.

The European indexes gained after the European Central Bank held key rate. The euro area economic climate deteriorated in the fourth quarter. Spain sold €4.76 billion of bonds at lower yields.

Greek jobless rate increased to 25.4% in August. German trade surplus rose and French trade deficit narrowed but Hungarian surplus declined in September. Swiss unemployment increased to 3%.

Societe Generale net banking income fell 17% to €5.4 billion and Dexia net loss group share was €1.23 billion in the third quarter. Siemens plans savings of €6 billion by 2014. EADS quarterly revenues grew 15% to €12.32 billion.

The UK indexes fell after the Bank of England left the key rate unchanged at 0.5% and maintained its quantitative easing at £375 billion. Irish consumer price inflation eased in October.

Stocks in Japan continue to drift lower and the Nikkei index dropped to a 3-week low. Machinery orders fell 4.3% in September on falling exports. Oki Electric and Citizen Holdings fell on lowered expectations but Isuzu Motor boosted annual net income outlook.

Australian benchmark index declined 0.7% tracking lower world markets. Resource stocks led the decliners. Qantas said it will eliminate 500 jobs in Australia as it cuts one aircraft maintenance hub.

Commodities, Bonds and Currencies

U.S. treasury yield on 10-year bond decreased to 1.62% and on 30-year bond fell to 2.76%.

The U.S. dollar inched higher to $1.274 to a euro and increased against the Japanese yen to 79.37 yen.

Immediate delivery futures of Texas crude oil increased 64 cents to $85.06 a barrel and Brent crude rose 43 cents to $107.28, futures of natural gas increased 0.02 cents to $3.60 per mbtu and gasoline traded up 2.8 cents to 261.70 cents a gallon.

In metals trading, copper increased 2.80 cents to $3.45 per pound, gold increased $19.60 to $1,733.60 per ounce and silver increased 72 cents to $32.39.

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