U.S. Techs Struggle, Crude Oil at $145

123jump.com Staff
03 Jul, 2008
New York City

U.S. stocks edged higher but tech stocks remain weak as they have been in the past one month of trading. Crude oil traded at record level as specluators, weak dollar and steady demand drive oil prices. Tech stocks fell, led by weak semiconductor stocks after Nvidia cut its revenue and gross margin guidance. ECB in Europe, raised its key rate by 0.25% to 4.25%. Vodafone agreed to acquire 70% stake in Ghana Telecom to tap into one of the fastest growing wireless markets.

7:30PM New York, 1:30AM Frankfurt, 9:30AM Sydney[R]– Crude oil continues to trade in record territory and tech stocks fall again on weak semiconductor stocks.[/R]

Global Markets Update

U.S. economy shed 62,000 jobs in June and 438,000 in the first six months as retailers, builders and transportation industries lay people off. Unemployment in the month fell to 5.5% but may rise in the months to come as more jobs are likely to be lost in the financial services and retail sector. Separately JP Morgan will lay off 10% of investment banking staff in Europe.

European Central Bank increased its key lending rate by 0.25% to 4.25% and investors speculated that rates may remain stable in the near future, despite signs of rising inflation in the regions. Central banks in India, Philippines, Egypt and Australia have increased rates to combat inflation in the last three months.

UK based Vodafone Group agreed to buy 70% stake in Ghana Telecom for $900 million. Wireless subscribers are rising at 55% in Ghana and Vodafone has been expanding in Africa, India, Turkey and Qatar. Vodafone recently purchased 52% stake in Hutchison Essar with from Hong Kong based conglomerate Hutchison and acquired a stake in Turkey based Telsim Mobil $4.6 billion.

North American Markets indexes

Dow Jones Industrial Average increased 73.03 to a close of 11,288.54, S&P 500 closed up 1.38 or 0.11% to 1,262.90, and Nasdaq Composite Index decreased 6.08 or 0.27% to close at 2,245.38. In Toronto TSX Composite closed up 109.46 or 0.78% to 14,143.57.

Of the 30 stocks in Dow Jones Industrial Average 22 stocks gained and 8 declined.

United Technologies led the gainers in the Dow Jones Index with a rise of 2.2% followed by increases in Alcoa of 2%, in JP Morgan Chase of 2.05%, in American Express of 1.6%, in Procter & Gamble of 1.6% and in General Electric of 1.5%.

AIG led the decliners in the Dow Jones Index with a loss of 1.9% followed by losses in Intel Corp of 1.3%, in AT&T Inc of 0.9%, in Bank of America of 0.6% and in McDonalds of 0.4%.

Of the stocks in S&P 500 index, 246 increased, 249 declined and 5 rose. Of the index stocks 12 stocks rose more than 3% and 41 fell more than 3%.

Nvidia Corp led the decliners in the S&P 500 index with a loss of 30% followed by declines in Zions Bancorp of 15%, in Freddie Mac 8.9%, UnitedHealth Group of 8.6%, in First Horizon of 7.6% and in AK Steel of 6.8%.

MGIC Investment Corp led the gainers in the S&P 500 index with a rise of 8.8% followed by gains in Ecolab Inc of 4.8%, in Amgen Inc of 4.1%, in Liz Claiborne of 4.05%, in Juniper Networks of 4% and in Pulte Homes of 3.8%.

South American Markets Indexes

Peru led the decliners in the Latin American markets with a loss of 3.7% followed by losses in Brazil of 3%, in Chile of 2.85%, in Argentina of 1.7% and in Mexico of 0.75%. Venezuela led the gainers in the region with a rise of 2% followed by increases in Colombia of 1.9% and in Costa Rica of 0.2%.

European Markets Indexes

The CAC 40 added 47.51 or 1.11% to 4,343.99. In Germany the DAX 30 index increased 48.32 or 0.77% to 6,353.74. Swiss Market index added 0.31 to 6,844.06. The FTSE 100 closed lower 50.30 or 0.93% to 5,476.60.

Asian markets

In Tokyo Nikkei 225 Index closed lower 20.97 or 0.16% to 13,265.40, in Hong Kong Hang Seng index decreased 461.67 or 2.13% closed to 21,242.78. In Australia ASX 200 index lower 96.50 or 1.89% to close 4,998.30. Malaysia financial markets were closed today.

In South Korea Kospi Index decreased 17.06 or 1.05% to close at 1,606.54, in Thailand SET index closed lower 17.86 or 2.35% to 742.15 and Indonesia JSE Index edged decreased 91.86 or 3.86% to 2,286.61. Sensex index in India decreased 570.51 or 4.18% to 13,094.11.

Commodities, Metals, and Currencies

Crude oil increased $0.04 to close at $145.33 a barrel for a front month contract, natural gas was unchanged to $13.58 per mBtu, and gasoline futures increased 2.16 cents to close at 357.10 cents per gallon.

Gold decreased $12.90 in New York trading to close at $933.60 per ounce, silver closed down 5.50 cents to $18.37 per ounce, and copper for front month delivery increased 11.45 cent to $3.94 per pound.

Wheat futures increased 7.25 cent in Chicago trading and closed at $8.87 per bushel. Sugar decreased 7 cent to $13.91 per pound. Soybean future closed up 1.00 cents to $16.31 a bushel.

Dollar edged higher and traded near record low against euro to $1.5696 and rose against yen to 106.74.

Yields on U.S. bonds increased to 3.98% with 10 years of maturities and decreased to 4.54% with 30-year of maturities.