Wall Street Extends Global Advance, Sterling Falls on UK Downgrade

Nichole Harper
25 Feb, 2013
New York City

U.S. stocks extended global market advance after Italian elections are expected to deliver outcome favored by investors and Japan is likely to appoint the next head of central bank who prefers easier monetary policy. 2010 Gulf of Mexico oil spill trial began today against BP Plc.

[R]11:25 AM New York – U.S. stocks extended global market advance after Italian elections are expected to deliver outcome favored by investors and Japan is likely to appoint the next head of central bank who prefers easier monetary policy. 2010 Gulf of Mexico oil spill trial began today against BP Plc.[/R]

Stocks in morning in New York traded higher following a global markets surge.

Market indexes extended gains after Italian election exit poll suggested market favorite outcome, UK pound declined and Chinese manufacturing growth declined.

Market indexes in Italy surged 3.8% and banks soared more than 4% on the prospect of the left party winning the general election.

Preliminary exit polls late afternoon showed that center-left coalition led by Pier Luigi Bersani is leading with 34.5% and former Prime Minister Silvio Berlusconi led center-right group trailing second with 29%.

The UK pound declined 0.7% after the rating agency Moody’s Investors Services on late Friday dropped the UK government debt rating to Aa1 from Aaa. The rating agency cited high government debt and rising national obligation amidst weak growth outlook.

The weaker pound lifted the FTSE 100 index higher 0.4% on the prospects of earnings as most companies in the index generate large share in earnings overseas.

Asian markets rallied and market indexes in Tokyo soared 2.4% on the media speculation that the next governor of the Bank of Japan is likely to favor easier monetary policy.

Haruhiko Kuroda, the chief of Asian Development Bank is likely to be proposed by the Prime Minister Shinzo Abe.

2010 Gulf of Mexico oil spill trial began against BP Plc began today and details of talks of settlement with the federal and state governments also emerged.

The settlement calls for a total proposal between $13 billion and $16 billion depending on certain conditions and that included fines and penalties and a slush fund to tackle future environmental damage liabilities.

According to the lawyers briefed on the settlement terms the discussions are tentative and several conditions for the payment are still not proposed.

Stocks in Review

Affymax ((AFF)) plunged 85% after the company and Takeda Pharmaceuticals issued a recall in the U.S. for their antianemia drug on the reports of severe allergic reactions and few deaths.

Barnes & Noble ((BKS)) soared 8% after the company’s chairman and its largest investor is considering a plan to buy only the book store chain and not its digital business.

Dillard''s, Inc. ((DDS)) plunged 8.8% or $7.39 to $77.77 after the discount retailer

Elan Corporation, plc soared 7.4% or 79 cents to $11.39 after the Ireland based biotechnology acknowledge that Royalty Management, LLC’s proposal of $6.5 billion.

Lowe’s Companies, Inc ((LOW)) slipped 15 cents to $37.52 after the home improvement retailer reported better than expected and earnings and announced a $5 billon stock repurchase program.

Hertz Global gained 6% after the company reported better than expected quarterly results after the acquisition of Dollar Thrifty Automotive Group. The company also issued positive outlook for the year.

Pearson Plc the publisher of expensive college text books and Financial Times said as a part of its restructuring program it plans to cut jobs and shift focus to digital education and to markets in China and India.