U.S. Indexes Rebound Rate Talks, Crude Oil Jumps 5%

Nichole Harper
06 Apr, 2015
New York City

U.S. stocks rebounded after Fed official suggested future rate increase are likely to be gradual. Crude oil jumped 5% after Saudi Arabia increased oil price for Asian customers. Russian ruble rebounded and Real in Brail rallied for the fifth day. European markets were closed today.

[R]1:40 PM New York – U.S. stocks rebounded after Fed official suggested future rate increase are likely to be gradual. Crude oil jumped 5% after Saudi Arabia increased oil price for Asian customers. Russian ruble rebounded.[/R]

Stocks in New York rebounded after the release of employment data on Friday and trading in commodities markets dominated headlines.

Gold jumped 1.8% and oil added more than 5% as currencies in Malaysia, Brazil and in Russia gained against the dollar. Russian ruble traded below $56 for the first time this year, an increase of 1.5%.

Markets in Europe were closed and U.S. market indexes gained after a three-day holiday and reacted for the first time to the employment report.

Investors also refocused on the impact of the report on the future direction of interest rate after New York Fed President William Dudley said future increase in rates are likely to be “shallow.”

Dudley comments are the first from the core member of the policy committee.

On Wall Street trading, Tollbooth Strategy Index gained 0.5% or 53.88 to 10,503.78.

S&P 500 index jumped 17.10 or 0.8% to 2,083.97 and the Nasdaq Composite Index increased 32.19 or 0.7% to 4,918.68.

Crude oil in New York jumped $2.49 to $51.63 a barrel and gold surged $20.30 to $1,221.20 an ounce.

Crude oil jumped after the state-controlled Saudi Arabian Oil Company shrank the discount it offered to Asian customers, an effective increase of 30 cents a barrel from the previous month.

U.S. Movers

Bristol-Myers Squibb Co ((BMY)) rose 12 cents to $63.39 after the biopharmaceutical company said it plans to invest $100 million in The Netherlands-based biotech uniQure NV.

The company will acquire 4.9% stake in UniQure of at least $32 million at $33.84 per share and an additional 5% stake before end of the year at a 10% premium.

The deal includes upfront payment of $50 million at the closing of the transaction to get access to its gene therapy technology platform for cardiovascular diseases.

The transaction is expected to close by the end of second-quarter in June.

Shares of Uniqure NV surged 46.6% to $33.52.

Shanda Games Limited ((GAME)) jumped 4.3% or 28 cents to $6.77 after the China-based online game developer agreed to be taken private by Capitalhold Ltd and its unit Capitalcorp Ltd for $3.55 for ordinary shares and $7.10 for American depositary receipts or in a deal valued at $1.9 billion.

The merger is currently expected to close in the second-half of 2015.

Ventas, Inc ((VTR)) climbed 4.9% or $3.62 to $76.85 after the real estate developer agreed to acquire the privately-owned hospital operator Ardent Medical Services, Inc. for $1.75 billion in cash.

The transaction is expected to close before the end of first-half.

Separately, the company said it would spin off most of its skilled nursing facilities into an independent real-estate investment trust.

The transaction is expected to be completed in the second-half of 2015.

Asian Markets

Nikkei 225 Average in Tokyo eased following weaker than expected U.S. jobs report. Toshiba Corp dropped after the company appointed a committee to investigate earnings irregularity in the fiscal year ending in March 2014.

Stocks in Tokyo eased after the latest jobs report in the U.S. fell short of most economists’ lowest estimate.

Net new jobs added in March in the U.S. declined to 126,000 and estimates of jobs increase were revised lower for January and February by 69,000.

Jobless rate was held at 5.5% but the number of people looking for jobs longer than 27 weeks fell.

The Nikkei 225 Stock Average fell 37.10 to 19,397.98 and the broader Topix index slid 3.45 to 1,560.71.

The yen slipped to 119.09 against a dollar.

Stocks in Mumbai traded higher and investors bid up stocks ahead of Reserve Bank of India policy meeting later in the week.

Investors bid up pharmaceutical stocks for the second day in a row ahead of RBI policy meeting tomorrow.

RBI is expected leave repo rate and cash requirements ratio for banks unchanged but lower the statutory rate.

Market is also awaiting the statement from Governor Raghuram Rajan views on inflation.

Wholesale inflation has dipped substantially in the last six months, however local government controlled transportation companies in large metro areas are lifting fares and food prices remain at elevated level across most of the nation.

Rupee gained 31 paisa 62.18 against one dollar.

The Sensex Index jumped 244.32 or 0.9% to close at 28,504.46. The CNX Nifty gained 73.65 or 0.9% to 8,659.90.

Bharat Heavy Electricals Limited advanced 1.4% to ₹235 after the power generation equipment maker’s orders soared 10.02% from the quarter year ago to ₹30,814 crore.

The company estimated net in the fourth-quarter plunged 62% to ₹1,314 crore and net sales declined 23.6% to ₹30,806 crore compared to in the same period last year.

Larsen & Toubro Limited added 1.3% to ₹1,755.80 after the engineering infrastructure maker secured orders worth ₹5,492 crore in March.

NTPC Limited climbed 2.7% to ₹151.85 after the power generation company plans acquire power plants worth ₹5,000 crore by the end of this year. The company said in a statement that several power plant companies have shown interest in striking deals.