U.S. Stocks Rise, Japan Up 3%, Dell Surges

123jump.com Staff
29 May, 2008
New York City

U.S. stocks edged higher after the revised estimate of the first quarter GDP showed a rise of 0.9% growth compared to previously estimate of 0.6%. Larger than expected decline in trade deficit lifted the economic growth. Separately Bear Stearns shareholders approved the sale of the company to JP Morgan. Crude oil and gold prices fell sharply. After the close, Dell Inc reported first quarter revenue rise of 9.2% and net income gain of 3.7%.

10:00PM Frankfurt, 4:00PM New York, 8:00AM Sydney[R]–The U.S. GDP rose at a rate faster than previously estimated rate, lifting stocks in the U.S. and Europe. Japan leads the world markets with a rise of 3%.[/R]

Global Markets Update

The U.S. economic growth in the first quarter was revised upwards to 0.9% from 0.6% on shrinking trade deficit. The upward revision follows the 0.6% rise in economic growth of 0.6% in the fourth quarter. In addition, the weekly unemployment claims rose at the end of the last week. Costco reported better than expected earnings and Sears swung to a quarterly loss. MasterCard surged after lifting its revenue and earnings guidance.

The discount retailers Costco, Fred’s and Big Lots benefited in the latest quarter as consumer look for discounts. Sears swung to a quarterly loss after same store sales declined. Costco sales rose 13% to $16.26 billion and net income increased 32% to $295 million. Earnings per share rose to 67 cents. Big Lots sales rose 2.1% to $1.15 billion and earnings increased 16% to $34.5 million or 42 cents per share.

European markets edged lower as home prices in the UK fell, record inflation in Spain and German unemployment edged higher. Annualized inflation in Spain in May rose to 4.7% in May from 4.2% in April. The sharp rise in inflation is fueled by rising energy and food prices. UK home prices fell for the seventh month in a row as more buyers face tighter mortgage lending.

In London trading, FTSE 100 declined 0.02% or 1.5 to 6,068.10 pulled back by loses in homebuilders. Persimmon dropped nearly 4% after reports that UK home prices fell in May. Of the FTSE 100 index stocks, 41 shares gained, 61 shares declined while 1 stock remained unchanged. UK home prices fell 2.5% in May from April and were 4.4% from a year ago and up 5% from two years ago.


European Markets indexes

In London FTSE 100 Index closed lower 1.5 or 0.02% to 6,068.10, in Paris CAC 40 Index increased 0.10% to close at 4,975.90 and in Frankfurt DAX index higher 21.19 or 0.30% to close at 7,055.03. In Zurich trading SMI increased 67.26 or 0.90% to close at 7,541.76.

North American Markets indexes

Dow Jones Industrial Average rose 52.19 or 0.41% to a close of 12,646.22, S&P 500 closed up 7.42 or 0.53% to 1,398.26, and Nasdaq Composite Index increased 21.62 or 0.87% to close at 2,508.32. In Toronto TSX Composite closed down 111.45 or 0.76% to 14,577.17.

Of the 30 stocks in Dow Jones Industrial Average, 22 closed higher, 7 closed lower, and one was unchanged.

Johnson & Johnson led the gainers in the Dow Jones Index with a rise of 2.4% followed by increases in Bank of America of 2.1%, in Citigroup of 2.04%, in AT&T of 1.75% and in JP Morgan of 1.66%. Alcoa led the decliners in the Dow Jones index with a fall of 2.96% followed by losses in Chevron of 1.55%, in Intel of 1.4% and in Exxon Mobil of 1.2%.

Of the stocks in S&P 500 index, 366 stocks increased, 130 declined, and 4 were unchanged. Of the stocks in the index, 20 stocks fell more than 3% and 35 gained more than 3%.

Ambac Financial Group led the gainers in the S&P 500 index with a rise of 9.2% followed by increases in Countrywide Financial of 8.2%, in Big Lots of 7.5%, in first Horizon of 6.5%, and in Expedia of 5.7%. Freeport McMoran led the decliners in the S&P 500 index with a loss of 5.5% followed by losses in Range Resources of 5.3%, in EOG Resources of 4.9%, in Apache Corp of 4.2%, in Tesoro Corp of 4.04% and in Noble Energy of 3.67%.

South American Markets Indexes

Brazil led the decliners in the Latin American markets with a fall of 1.85% followed by decreases in Peru of 1.1%, in Argentina of 0.43% and in Venezuela of 0.33%. Colombia led the gainers in the region with a rise of 1% followed b gains in Chile of 0.8% and in Mexico of 0.6%.

Asian markets

In Tokyo Nikkei 225 Index closed higher 415.03 or 3.03% to 14,124.47, in Hong Kong Hang Seng index climbed 134.48 or 0.55% closed to 24,383.99. In Australia ASX 200 index climbed 61.30 or 1.09% to close 5,709.40. In Malaysia KL Composite index increased 1.24 or 0.10% to close at 1,261.82.

In South Korea Kospi Index increased 35.58 or 1.97% to close at 1,841.22, in Thailand SET index decreased 2.38 or 0.29% to 830.61 and Indonesia JSE Index edged increased 13.18 or 0.52% to 2,446.95. Sensex index in India fell 209.11 or 1.27% to 16,316.26.

Commodities, Metals, and Currencies

Crude oil decreased $4.47 to close at $126.56 a barrel for a front month contract, natural gas decreased 53 cents to $11.47 per mBtu, and gasoline futures decreased 3.5 cents to close at 341.30 cents per gallon.

Gold decreased $23.30 in New York trading to close at $881.70 per ounce, silver closed down 90 cents to $16.51 per ounce, and copper for front month delivery decreased 13.65 cents to $3.55 per pound.

Wheat futures decreased 15.5 cent in Chicago trading and closed at $7.43 per bushel. Sugar decreased 14 cent to $9.97 per pound. Soybean future closed down 50.00 cents to $13.22 a bushel.

Dollar edged higher and traded near record low against euro to $1.5502 and rose against yen to 105.57.

Yields on U.S. bonds increased to 4.08% with 10 years of maturities and increased to 4.75% with 30-year of maturities.