U.S. Stocks Meander, DAX in Germany Plunges 3% as VW Scandal Widens

Nichole Harper
23 Sep, 2015
New York City

Stocks in New York and Europe lacked direction and commodities bounced around with a downward drift as investors start looking ahead to earnings. German stock index plunged 3% as Volkswagen Scandal widened and CEO resigned.

[R]3:15 PM New York City, New York – Stocks in New York and Europe lacked direction and commodities bounced around with a downward drift as investors start looking ahead to earnings. German stock index plunged 3% as Volkswagen Scandal widened.[/R]

Stocks on Wall Street lacked direction and investors began shifting focus to earnings announcements.

With the ongoing Fed uncertainties and ongoing weakness commodities was compounded by yet another economic data from China. A private survey showed that the manufacturing sector growth has dropped to the lowest level not seen since the depth of the financial crisis in 2009.

In addition, German market index was under the pressure after Volkswagen AG chief executive resigned after the company admitted for falsifying emission testing data in the U.S.

German automaker may face a sharp fall in sales and that could impact several domestic suppliers and may even affect the German economic growth rate in the next few quarters.

On Wall Street, Tollbooth Strategy Index fell 29.84 or 0.3% to 10,344.40.

S&P 500 index edged down 2.64 to 1,939.98 and the Nasdaq Composite Index edged up 3.15 to 4,759.67.

Crude oil in New York rose 57 cents to $46.93 a barrel and gold increased $6.30 to $1,131.10 an ounce.

U.S. Movers

Boeing Co ((BA)) gained 82 cents to $134.61 after the aircrafts maker received an order for 300 jets aircraft at list prices of about $10 billionfrom three Chinese firms.

Boeing will set up an aircraft plant jointly with Commercial Aircraft Corporation of China, Ltd.

The aircraft maker said that the Chinese plan may supply parts and assemblies to orders from Asia. Boeing estimates as much as 35% of all orders are likely to come from the region.

China’s President Xi Jinping is scheduled to visit Boeing factory in Washington.

Separately, the Indian government placed an order ahead of Prime Minister Narendra Modi scheduled to arrive in the U.S. for 37 military Apache multi-role and Chinook heavy-lift helicopters for about $3 billion with an options to buy additional 11 Apache helicopters and 7 Chinook helicopters.

Landmark Aviation, the Houston, Texas-based privately held aircraft maintenance and repairing services provider is in talk to be acquired by the U.K.-based rival BBA Aviation for about $2.07 billion.

European Markets

In London trading, FTSE 100 index dropped 146.20 or 2.4% to 5,962.48 and in Frankfurt the DAX index slumped 323.66 or 3.3% to 9,623.

In Paris, CAC 40 index declined 154.70 or 3.4% to 4,430.80.

Axel Springer SE slipped 1.2% to €52.59 and the Germany-based print and media group is in talks to acquire the U.S.-based online digital news provider Business Insider for about $500 million.

Separately, the company and ProSiebenSat.1 Media SE agreed to acquire a minority stake in the U.S.-based start-up Jaunt, a specialist in the creation and distribution of virtual reality contents developer.

The company signed a contract with Switzerland-based Ringier AG to create jointly owned German and French-speaking daily newspaper company in Switzerland, as the approval is already granted by the Switzerland’s Competition Commission and Germany’s Federal Cartel Office.

The print and media group divested all of its Russian assets including GEO, OK! and the Russian version of Forbes, forbes.ru, finanz.ru, OK!, GEO and Gala Biografia to he domestic publisher Alexander Fedotov.

Smiths Group Plc increased 1.5% to 1,045 pence after the U.K.-based industrial conglomerates reported revenues in the year ending in July slipped 2% from a year ago to £2.90 billion.

Net profit in the year soared 5.6% from a year ago to £246 million compared to £233 million and diluted earnings per share rose to 61.8 pence from 58.4 pence.

The engineering company said pretax profit in the year jumped 3.1% to £459 million compared to £445 million in a period a year ago.

Swiss Re AG rose 0.6% to 82.85 Swiss francs after the Switzerland-based insurance services provider’s business unit Admin Re agreed to acquire Guardian Financial Services from private equity firm Cinven for £1.6 billion or $2.45 billion.

Asian Markets

Stocks in Mumbai rebounded and the benchmark Sensex index jumped at the open bur faced volatile trading in the late afternoon.

Rupee weakened 10 paisa to 65.97 against one U.S. dollar.

The Sensex Index increased 171.15 or 0.7% to close at 25,822.99. The CNX Nifty rose 33.95 or 0.4% to 7,845.95.

Pfizer plans to sell its plant in Thane, Maharashtra to Gujarat-based Vidhi Research and Development for ₹178 crore.

Pidilite plans to expand its business in the Asian and African Markets.