U.S. Indexes Turn Lower and European Markets Drop 1% on ECB Stimulus Delay

Nichole Harper
04 Dec, 2014
New York City

Stocks on Wall turned lower and energy stocks led the decline after the crude oil dropped 1% and extended the loss in the year to 40%. European Central Bank is wait for another quarter of data before announcing additional stimulus measures. ECB President also lowered growth and inflation estimates.

[R]12:50 PM New York – Stocks on Wall turned lower and energy stocks led the decline after the crude oil dropped 1% and extended the loss in the year to 40%. European Central Bank is wait for another quarter of data before announcing additional stimulus measures.[/R]

Stocks on Wall Street declined after the weakness in energy stocks and European Central Bank President Mario Draghi signalled that the new stimulus measures are likely to be postponed after the release of next quarterly data.

On Wall Street trading, Tollbooth Index fell 0.3% or 34.01 to 9,984.26.

S&P 500 index slipped 5.52 or 0.3% to 2,068.76 and the Nasdaq Composite Index slid 3.31 or 0.07% to 4,771.31.

European Central Bank President Mario Draghi said policy makers are going to wait for additional quarter data.

The statement dashed the hopes of economic stimulus measures that is likely to include wide range of asset purchase. The move is likely to mirror the steps taken by the U.S. Federal Reserve few years ago and may expand beyond government bonds and securities.

U.S. Movers

Dollar General Corp ((DG)), the discount retailer net sales in the third-quarter ending in October jumped 7.8% to $4.72 billion from a year ago period. Same store sales in the quarter rose 2.8%.

Net income in the quarter slid 0.5% to $236.3 million or 78 cents a diluted share compared to $237.4 million or 74 cents from a same quarter last year.

The Kroger Co ((KR)), the food retailer reported total sales in the third-quarter ending on November 8 soared 11.2% to $25 billion from a year ago period.

Net earnings in the quarter surged 21.1% to $362 million or 73 cents a diluted share compared to $299 million or 57 cents from a same quarter last year.

NextEra Energy Inc ((NEE)), the electric power company agreed to acquire rival Hawaiian Electric Industries, Inc in a deal valued at about $4.3 billion.

The transaction is expected to close before end of 2015.

Sears Holdings Corp ((SHLD)), the retailer reported revenues in the third-quarter ending on November 1 dropped 13.2% to $7.2 billion from a year ago period.

For the quarter, domestic comparable store sales declined 0.1%, comprised of an increase of 0.5% at Kmart and a decrease of 0.7% at Sears Domestic.

Net loss in the quarter widened to $548 million or $5.15 a diluted share compared to $534 million or $5.03 from a same quarter last year.

European Markets

In London trading, FTSE 100 index fell 0.3% or 19.22 to 6,697.41 and in Frankfurt the DAX index slipped 0.5% or 55.02 to 9,916.77.

In Paris, CAC 40 index dropped 1.2% or 52.80 to 4,339.06.

In the European corporate news, DS Smith profit soared 36% to £95 million. EasyJet said passengers and load factor in November increased. Ryanair said passengers in November climbed 22% and lifted profit outlook.

Mulberry net swung to a loss on 17% decrease in revenues. TUI Travel net surged 246% to £187 million.

DS Smith Plc, the U.K.-based packaging company reported revenues in the first-half ending in October dropped 5.3% to £1.97 billion from £2.08 billion a year ago period.

Net profit in the year soared 35.7% from a year ago to £95 million compared to £70 million and diluted earnings per share slipped to 7 pence from 10.1 pence.

EasyJet Plc gained 1.3% to 1,690.60 after the U.K.-based airline company said total number of passengers in November jumped 3.1% to 4,386,296 and load factor increased to 89.5% from 89% a year ago month.

Ryanair Holdings Plc, the Ireland-based low-cost airline company said passengers in November climbed 22% to 6.35 million customers and load factor rose to 88% from 81% a year ago month.

The company revised its full-year traffic guidance of 90 million passengers from earlier estimate of 89 million passengers.

Ryanair also lifted after-tax profit forecast for the year to between €810 million and €830 million from the previous guidance between €750 million and €770 million.

TUI Travel Plc, the U.K.-based travel company reported revenues in the year ending in September slipped 3% to £14.62 billion from £15.05 billion a year ago period.

Net profit in the year surged 246.3% from a year ago to £187 million compared to £54 million and diluted earnings per share jumped to 16.3 pence from 4.6 pence.

Asian Markets

Stocks in Tokyo closed higher and automakers led the charge. The yen closed at its weakest since 2007 and the Japanese currency has declined 12% in the year so far against the U.S. dollar. Softbank invests in taxi booking service provider in Southeast Asia.[/R]

Sharp drop in Japanese yen lifted market indexes and automaker led the gainers.

The yen dropped to a low not seen since 2007 on the renewed optimism that the U.S. economic growth will accelerate after the recent fall in crude oil prices and auto sales are likely to surpass six-year high.

The Nikkei 225 Stock Average jumped 166.78 or 0.9% to 17,887.21 and the broader Topix index increased 10.85 to 1,440.60.

The yen rose 0.1% to 119.95 against one dollar.

In Mumbai trading, the Sensex Index advanced 120.11 or 0.4% to close at 28,562.82. The CNX Nifty gained 26.75 or 0.3% to 8,564.40.

Reliance Industries Limited, the government of India is looking to recover $160 million or Rs 960 crore from the natural gas energy block, KG-D6, operators from the contractors for sharply dropping the natural gas production.

Reliance Industries controls 60% of oil well, BP Plc controls 30% and Niko Resources holds 10% stake.

Steel Authority of India Ltd, the government plans to sale 5% stake or 206.5 million shares to raise about Rs 1,700 crore through a secondary offering.