Weekly Rally, Monthly Decline

123jump.com Staff
31 Oct, 2008
New York City

U.S. stocks edged higher after JP Morgan suspended foreclosures on loans issued to 400,000 homeowners with $110 billion of mortgages. Stocks edged higher in the afternoon on the JP Morgan action. European markets closed up 2% or better. In Asia, Japan lowered its key lending rate. India surged 8%.

4:30PM New York, 10:30AM Frankfurt, 6:30AM Sydney[R]– U.S. stocks edged higher after JP Morgan expanded its loan foreclosure program $110 billion mortgages. Japan lowered its key lending rate meeting the expectations of a rate cut. India surged 8%.[/R]

Global Markets

U.S. stocks closed higher after JP Morgan Chase issued a statement to not add any more new loans to foreclosure process before offering modified terms. The widened program is likely to benefit 400,000 families with $110 billion mortgage loans.

The U.S. personal spending in September declined at 0.3% from the revised increase of 0.1% in August. Salaries and wages increased at the slower pace in the month than in August. The employment cost in the third quarter rose at 0.7% matching the gains in the first two quarters of this year.

The Bank of Japan lowered rates by 20 basis points to 0.3%. The BoJ chairman casted the decisive vote. In trading, Nikkei 225 index fell 5% to 8,576. The benchmark index dropped 24% in October. Nikon Corp cuts its profit estimate by 40%.

Stocks in Hong Kong fell 2.5% and in Shanghai dropped 2% on weak bank earnings. Energy stocks fell after crude oil declined below $65 a barrel. Bank of Communications dropped 5.4% after it reported 22% in third quarter. China Unicom fell 4% after earnings declined 13%.

Stocks in Mumbai surged 8% on the first of day trading. ONGC profit declined 5.7% and Bharat Petroleum and Indian Oil Corporation reported larger losses. A rise of 0.5% in rupee lifted stocks of software exporters. Punjab National Bank profit rose 31% and Kotak Mahindra profit declined 37%.

Stocks in Australia edged higher but for the month declined 12.7%, the worst decline in the month in more than three decades. New home sales in September fell 1.8% after dropping 1.3% in August. Lihir Gold production in the quarter ending in September rose 40%.

North American Markets

Dow Jones Industrial Average increased 144.32 or 1.6% to a close of 9,325.01, S&P 500 Index closed up 14.66 or 1.5% to 968.75, and Nasdaq Composite Index increased 22.43 or 1.3% to close at 1,720.95. In Toronto, TSX Composite Index fell 93.45 or 0.95% to 9,762.76.

For the week S&P 500 index rose every day of the week and gained 10% and fell 17% in the month.

Of the 30 stocks in Dow Jones Industrial Average 21 closed higher, 8 fell and 1 was unchanged.

General Motors led the decliners in the Dow with a loss of 4.6% followed by losses in Verizon Communication of 2.7%, in Coca-Cola Company of 1.4% and in Microsoft Corp of 1.3%.

JP Morgan Chase led gainers in the Dow Jones Industrial Average with a rise of 9.7% followed by gains in Bank of America of 6.1%, in American Express of 5.5%, in Citigroup Inc of 4.2%, in Home Depot Inc of 3.8% and in Boeing Company of 3.4%.

Of the stocks in S&P 500 index, 372 increased, 126 declined and two were unchanged. Of the index stocks, 207 rose more than 3% and 39 fell more than 3%.

Electronic Arts led decliners in the S&P 500 index with a plunge of 17.9% followed by losses in Cummins Inc of 17.5%, in Sun Microsystems of 13%, in Carnival Corp of 11.5%, in Teco Energy Inc of 11% and in Eastman Kodak of 10.4%.

Dynegy Inc led the gainers in the S&P 500 index with a surge of 18% followed by gains in AIG of 17%, in International Game Technology of 16.6%, in Genworth Financial of 15.5%, Office Depot Inc of 15.4%, in General Growth Properties of 15.3%, in Windstream Corp of 15.2% and in D R Horton of 14%.

South American Markets Indexes

Argentina led gainers in the region with a rise of 3.8% followed by increase in Peru of 3.7%, in Chile of 2.2%, in Colombia of 0.7% and in Mexico of 0.4%. Venezuela fell 0.81% and Brazil declined 0.51%.

Europe Markets Review

In London FTSE 100 Index closed higher 85.69 or 2.00% to 4,377.34, in Paris CAC 40 Index increased 79.25 or 2.33% to close at 3,487.07 and in Frankfurt DAX index higher 118.67 or 2.44% to close at 4,987.97. In Zurich trading SMI increased 310.87 or 5.32% to close at 6,153.21.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 452.78 or 5.01% to 8,576.98, Hang Seng index in Hong Kong decreased 361.18 or 2.52% closed to 13,968.67. CSI 300 index in China lower 34.00 or 2.00% closed to 1,663.66. ASX 200 index in Australia increased 16.90 or 0.42% to close 4,018.00. The KL Composite index in Malaysia higher 10.05 or 1.18% closed to 863.61.

The Kospi Index in South Korea increased 28.34 or 2.61% to close at 1,113.06. SET index in Thailand closed higher 8.22 or 2.01% to 416.53 and JSE Index in Indonesia increased 82.84 or 7.06% to 1,256.70. The Sensex index in India increased 743.55 or 8.22% closed to 9,788.06.

Commodities, Metals, and Currencies

Crude oil increased $1.77 to close at $67.73 a barrel for a front month contract, natural gas increased 31 cent to $6.74 per mBtu and gasoline futures decreased 20.25 cents to close at 146.00 cents per gallon.

Wheat futures closed down 23.25 cents in Chicago trading and closed at $5.38 a bushel. Sugar decreased 0.24 cent to 11.85 cents a pound. Soybean future closed down 4 cents to $9.43 a bushel.

Gold decreased $13.50 in New York trading to close at $725.00 per ounce, silver closed down 4.50 cents to $9.76 per ounce and copper for the front month delivery decreased 20.95 cent to $1.87 per pound.

Dollar edged higher against euro to $1.2742 and rose against yen to 98.530.

Yields on 10-year U.S. bonds increased to 3.95% and with 30-year maturities increased to 4.37%.