S&P 500 Index Up 0.7%; European Markets Edge Up, Rates on Hold in India

Nichole Harper
01 Dec, 2015
New York City

Stocks on Wall Street advanced in halting fashion on the first day of trading in December after auto sales rose and construction activities expanded. European markets gained and unemployment in the euro zone edged down but remained elevated. India and Australia left rates unrevised.

[R][1:00 PM New York City, New York – Stocks on Wall Street advanced in halting fashion on the first day of trading in December after auto sales rose and construction activities expanded. European markets gained and unemployment in the euro zone edged down but remained elevated. India and Australia left rates unrevised.[/R]

Stocks on Wall Street pared early gains after a private survey on manufacturing showed a contraction in November but construction activities soared to a 8-year high.

The mixed data suggested that the U.S. economy remains in the uneven recovery mode and despite the weakness in consumer spending and manufacturing the construction activities continue to expand.

U.S. construction spending in October increased 1% at annual rate of $1,107.4 billion from the revised September estimate of $1,096.6 billion and soared 13% from a year ago spending of $979.6 billion, the Department of Commerce said.

U.S. factory activity index declined to 48.6, according to a private survey conducted by the Institute for Supply Management. The index declined below 50 for the first time since 2012, the reading below 50 indicates contraction in the sector.

On Wall Street, Tollbooth Strategy Index increased 41.63 or 0.4% to 11,029.62.

S&P 500 index gained 10.46 or 0.6% to 2,092.98 and the Nasdaq Composite Index increased 26.90 or 0.5% to 5,135.71.

Crude oil in New York slid 4 cents to $41.61 a barrel and gold added $1.25 to $1,066.02 an ounce.

U.S. Movers

Ford Motor Co ((F)) increased 1.3% or 19 cents to $14.50 after the automaker said November U.S. sales edged up 0.4% to 187,794 vehicles.

Passenger car sales in the month plunged 11.5% to 48,831 units and utility vehicle sales slumped 9.6% to 55,051 units while trucks sales surged 18.3% to 83,912.

Fiat Chrysler Automobile NV ((FCAU)) slid 12 cents to $14.12 after the vehicles maker said U.S. sales in November increased 3% to 175,974 units, the best November result since 2000.

Passenger car sales in the month tumbled to 32,478 units but sales in truck segment surged 11% to 143,946 units.

General Motors Company ((GM)) fell 20 cents to $35.99 after the automaker reported total sales in November increased 1.5% to 229,296 units and total retail sales jumped 4.4% to 183,141 units.

For the year, total sales soared 4.9% to 2,792,136 units.

European Markets

In a mixed trading session, European markets declined on Tuesday except in London where banks led the market in positive territory.

The largest banks in the U.K. recorded solid gains after all of them passed the annual financial stress tests of the Bank of England.

“The banking system was capitalized to support the real economy in a global stress scenario which adversely impacts the United Kingdom,” the central bank said.

In the euro zone the seasonally adjusted unemployment rate fell to 10.7% in October, compared to 10.8% in September and 11.5% in October 2014, Eurostat said

In the wider EU28 region, the unemployment rate was at 9.3%, unchanged from the previous month, but down from the rate of 10.1% in October 2014.

Manufacturing index in the euro zone increased to 52.8 in November from 52.3 in the previous month.

While export orders grew, the output price index remained below 50 for a third month, according to data provider Markit Economics.

In London trading, FTSE 100 index gained 36.28 or 0.6% to 6,393.19 and in Frankfurt the DAX index edged down 11.10 to 11,371.23.

In Paris, CAC 40 index slid 6.61 to 4,950.99.

Accor SA jumped 3.2% to €41.22 after the France-based hotels operator agreed to acquire 29 hotels with 3,677 rooms across Europe for about €284 million or $301 million.

The acquisitions include a portfolio from AXA Investment Managers - Real Assets for 56 million euros, a six-hotel portfolio from Invesco for €152 million, and a portfolio from Deutsche AWM for €76 million.

Linde AG plunged 14% to €142.05 after the Germany-based industrial gas and engineering company slashed its operating profit forecast for 2017.

The company warned of lower results in its engineering division, citing low oil prices and a decline in customers’ investments.

Revenues in the nine-month period ending in September jumped 7.7% from a year ago to €13.55 billion.

Net profit in the period soared 8.6% from a year ago to €937 million, while diluted earnings per share increased to €4.63 from €4.41.

Asian Markets

Nikkei average in Tokyo rose after three-days of decline. The manufacturing sector continued to expand in November and capital spending surged 11.2%. Nissan lifts its stake in Renault to 25%.

Nikkei average in Tokyo closed higher 265 points and crossed psychologically important 20,000 mark for the first time since August 20.

On the economy front, the capital spending in the third-quarter surged 11.2% compared to 5.6% in the second-quarter, the Ministry of Finance said.

The Markit/Nikkei Japan Final Manufacturing Purchasing Managers Index (PMI) was 52.6 in November, higher than the 52.4 reading in the previous month.

The index stayed above 50, the dividing line that separated expansion from contraction, for the seventh straight month.

Askul sales in November soared 13% and AIN Holdings profit jumped 30.5% and ITO EN profit soared 30.3%.

Mitsubishi Tanabe Pharma plans to invest 200 billion yen or $1.61 billion in the next five-years to expand drug sales in the U.S. market.

Nissan intends to lift its stake in Renault SA to 25% from the current stake of 15%.

The Nikkei 225 Stock Average soared 264.93 or 1.3% to 20,012.40 and the broader Topix index jumped 21.70 to 1,601.95.

The yen weakened to 123.12 against a dollar.

Nissan Motor Co Ltd dropped 2.4% to 1,283.50 yen after the automaker intends to lift its stake to 25% in the France-based Renault SA from the current 15% stake.

At present, Renault holds 43.4% stake in the Japanese automobile company.

Stocks in Mumbai traded higher after the Reserve Bank left its key lending rate unchanged as expected by most economists.

The Reserve Bank of India repo rate remains unchanged at 6.75% and cash reserve ratio also unchanged at 4%, the Reserve Bank of India said.

Rupee strengthened 18 paisa to 66.49 against one U.S. dollar.

The Sensex Index increased 23.74 to close at 26,169.41. The CNX Nifty rose 19.65or 0.3% to 7,954.90.

Maruti Suzuki India said auto sales in November advanced 9.7% and M&M vehicle sales surged 21%.

TV18 and CNN plans to renew their media partnership.