Stocks on Wall Street Zigzag, Weekly Jobless Claims Fall

Nichole Harper
29 May, 2014
New York City

U.S. stocks opened higher and weekly jobless claims declined 27,000. The U.S. economy shrank at annual pace of 1% in the second estimate after the impact of winter freeze was deeper than expected.

[R]10:45 AM New York – U.S. stocks opened higher and weekly jobless claims declined 27,000. The U.S. economy shrank at annual pace of 1% in the second estimate after the impact of winter freeze was deeper than expected.[/R]

Stocks on Wall Street opened higher after the U.S. economy shrank for the first time in three years and weekly jobless claims dropped.

S&P 500 index increased 0.25% to 1,914.29 and the Nasdaq Composite Index added 0.4% or 15.90 to 4,240.98.

Deeper Winter Slowdown

The U.S. gross domestic product in the first three months on 2014 declined at 1% annual compared to first estimate of 0.1% increase, the Commerce Department reported today.

The decline in the first quarter is the first since the fall in the first quarter in 2011 and the fall in activities was largely linked to slower buildup of inventories by businesses.

Difficult weather also played a key role and non-residential construction plunged 7.5% compared to the previous estimate of 0.2% increase.

The government agency also revised higher consumer spending to 3.1% from the 3% increase in the previous estimate and housing construction fell 5%, less than the initial estimate of 5.7%.

The growth in exports was revised lower to annual rate of 6% from the initial estimate of 7.6%.

Weekly Jobless Claims Drop

The claims of initial jobless claims for the week ending on May 24 declined 27,000 to 300,000, according to the Labor Department.

European Markets

Man Group gained 6% after the UK based largest alternative asset manager agreed to acquire Boston based Numeric Holdings LLC. Numeric is systemic investor and manages $13.9 billion in assets, according to its website.

FTSE 100 index increased 0.4% to 6,876.22, CAC 40 index eased 2.05 to 4,529.58 and the DAX 30 index declined 9.07 to 9,930.83.

Asian Markets

Market indexes in Japan gained and the retail sales in April plunged as expected after the announced sales tax increased brought forward retail sales.

Japan’s retail sales in April tumbled 13.7% compared to March, the worst decline in at least 14 years, after sales tax increased by 3 percentage points.

Sales at department stores declined at 10.6%, and at supermarkets dropped 3.9% but sales at convenience stores climbed to 4.2%.

The Nikkei 225 Stock Average edged up 10.77 to 14,681.72 and the broader Topix index rose 2.51 to 1,200.68.

The yen held at 101.82 against one U.S. dollar.

Market indexes in India declined after the latest batch of earnings from Coal India, Indian Oil, Tata Motors and Bajaj Electricals disappointed investors.

Infosys plunged 8% after a departure of an executive totalled tenth resignation in less than six months as the company struggles to management changes.

The Sensex Index declined 321.94 or 1.3% to close at 24,234.15 The CNX Nifty dropped 94 to 7,235.65.

Investors in Sydney turned cautious after spot price for iron ore dropped below $97 a ton and private capital expenditure declined.

Private capital expenditure in the March quarter declined 4.2% after adjusting for season factors from the revised 4.5% fall in the December quarter, the ABS reported today.

Australian dollar jumped to 92.96 U.S. cents and stock market trading turnover dropped to 552 million shares worth $3.33 billion.

ASX 200 index fell 7.70 to 5,519.50 and the broader All Ordinaries slid 7.50 to 5,499.20.