U.S. Indexes Trend Higher, Industrial Production Falls

Nichole Harper
15 May, 2013
New York City

U.S. stocks traded sideways but markets in Europe declined and in Asia extended recent highs. U.S. industrial production in April declined the most in eight months and producer price index fell 0.7%.

[R]10:55 AM New York – U.S. stocks traded sideways but markets in Europe declined and in Asia extended recent highs. U.S. industrial production in April declined the most in eight months and producer price index fell 0.7%.[/R]

Market averages and stocks in morning trading in New York traded sideways after a batch of economic news and the unexpected decline in the U.S. deficit.

The S&P 500 index decreased 0.09% and the Dow Jones, the narrow index of large companies, declined 0.1%. The Nasdaq Composite index gained 0.04%.

Industrial production in April declined the most in eight months, more than expected by economists.

Production at mines, factories and utilities declined 0.5% after a revised 0.3% increase in March, according to a report from the Federal Reserve.

A regional report from the Federal Reserve Bank of New York said its gauge of manufacturing activities in the New York area declined to -1.4 from 3.1 in April. Any reading below zero indicates contraction.

Separately, the Labor Department said it adjusted producer price index declined 0.7% in April, the largest fall since February 2010.

Wholesale price index for the year to April increased 0.6%, the smallest increase since July of last year.

European Markets

In London trading, FTSE 100 index decreased 0.1%, in Frankfurt the DAX index slid 0.4% and in Paris, CAC 40 index fell 0.3%.

The economies of the euro zone and the wider 27-nation European Union shrank for the second quarter in a row, and the region is expected to struggle for the rest of the year.

The statistics agency of the euro zone, eurostat, said today the economies of the euro zone contracted 0.2% in the first quarter to March after shrinking at 0.6% in the December quarter.

Germany barely grew with an expansion of 0.1% and after shrinking 0.7% and the contraction in France met the last quarter shrinkage of 0.2%. Spain and Italy shrank 0.5% and data on Greece were not available.

Asian Markets

Stocks in Tokyo resumed the advance and the benchmark index jumped above 15,000 for the first time in five and a half years.

Stocks have soared since November after Shinzo Abe led the charge ahead of election in December to lift economic growth and inflation in Japan and forced out central bank head.

The yen extended its slide and fell to 102.24 against one dollar, near the low since October 2008. The yen traded at 86.67 at the beginning of the year.

In other regional markets, Hang Seng index increased 0.5%.

Sensex in Mumbai soared 2.5% after the latest read on wholesale inflation index fell below 5%, the target set by the Reserve Bank of India. Market expectations ran high for a rate cut.

In addition, foreign investors have pumped nearly $13 billion in India’s financial markets so far in the year.