U.S. Stocks Fall, Google Net Drops 68%

123jump.com Staff
22 Jan, 2009
New York City

U.S. stocks edged lower on weak earnings. Microsoft, eBay, airlines and shipping companies reported weak earnings. Google after the close reported earnings decline of 68% on a write down of AOL and Clearwire investment. Google earned $1.21 a share after the write down.

[R]5:00PM New York – 11:00PM Frankfurt, 4:00AM Sydney – U.S. stocks edged lower on weak earnings from Microsoft, eBay, airlines and shipping companies.[/R]

UK home repossessions rose 92% in the third quarter and manufacturing survey showed weak sentiment in the sector. For the three months to January, the CBI survey indicated a decline in demand, fall in employment and a drop in capacity utilization. In listless trading, Lloyds Banking led gainers.

Japan exports in December plunged, in yet another confirmation of sharp deceleration in international trade among developed nations. Exports to U.S. declined for the sixteen month in a row and to China dropped 36% and Europe declined 42%. The Bank of Japan left rates unchanged.

Chinese economy grows at the slowest pace in the last seven years as the falling domestic demand and international trade contributes to the weakness. The GDP rises 6.8% in December as trade growth declines. Inflation falls sharply in December and corporate profits increase at the slowest pace.

Inflation in India edges to 5.6% but still lower than a year ago as the economy slows. Companies report mixed earnings. Reliance net drops 8.8%, Bharti Airtel net rises 25% and Hero Honda profit advances 9% and Bharat Forge profit slumps 92%. Coromandel Fertilisers net surges 77%.

Stocks in Australia rebounded after China reported economic growth of 6.8%, the slowest in seven years, but China still managed to grow at a faster pace than all developed economies, lifted hopes of sustain commodities exports to the region. Woodside Petroleum estimated 75% profit rise.

American Markets Reviews

Dow Jones Industrial Average decreased 105.30 or 1.3% to a close of 8,122.80, S&P 500 fell 12.74 or 1.5% to 827.50, and Nasdaq Composite Index declined 41.58 or 2.8% to a close of 1,465.49. In Toronto TSX Composite decreased 271.33 or 3.10% to close at 8,486.56.

In South American trading Brazil Bovespa Index decreased 1.7% or 190.37 to 19,306.73 and Mexico Bolsa Index edged lower 0.98% or 190.37 to 19,306.73.

Argentina declined 0.5%, Chile increased 1%, Peru declined 1.2% and Colombia edged lower 0.2%. Venezuela added 0.27%.

U.S. Stock Movers

Of the stocks in S&P 500 index, 457 increased, 41 declined and 2 were unchanged.

Coach Inc led decliners in the index with a loss of 7.3% followed by losses in Allegheny Technology of 6.8%, in Fifth Third Banc of 5.5%, in Johnson Controls of 5.2%, in MEMC Electric Material of 4.8%, in King Pharmaceuticals of 3.3% and in Wal-Mart Stores of 2.8%.

PNC Financial Services led gainers in the index with a rise of 38% followed by increase in Citigroup of 31.1%, in Bank of America of 31.6%, in Northern Trust of 30.9%, in Morgan Stanley of 28.7% and in JP Morgan Chase of 25%.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed higher 150.10 or 1.90% to 8,051.74, Hang Seng index in Hong Kong increased 74.36 or 0.59% closed to 12,657.99 CSI 300 index in China higher 22.84 or 1.13% closed to 2,044.55. ASX 200 index in Australia increased 44.00 or 1.28% closed to 3,486.80. The KL Composite index in Malaysia higher 5.61 or 0.64% closed to 879.02.

The Kospi Index in South Korea increased 12.62 or 1.14% to close at 1,116.23. SET index in Thailand closed higher 7.04 or 1.63% to 438.27 and JSE Index in Indonesia increased 5.87 or 0.44% closed to 1,327.32. The Sensex index in India increased 34.67 or 0.39% closed to 8,813.84.

Europe Markets Review

In London FTSE 100 Index closed lower 7.65 or 0.19% to 4,052.23, in Paris CAC 40 Index decreased 35.95 or 1.24% to close at 2,869.62 and in Frankfurt DAX index lower 41.73 or 0.98% to close at 4,219.42. In Zurich trading SMI increased 25.27 or 0.48% to close at 5,329.44.

Commodities, Bonds and Currencies

Yields on 10-year bond increased to 2.58% and on 30-year bonds increased to 3.24%.

The U.S. dollar rose to $1.2983 to a euro and against the Japanese yen fell to 89.05 yen.

Immediate futures prices of Texas crude oil decreased to $2.18 to $41.37 a barrel, for natural gas decrease 23 cents to $4.55 per mbtu and gasoline prices decreased 9.53 cents to 107.85 cents a gallon.

Futures of corn decreased 2.75 cent to $3.8750, soybean decreased 8.50 cents to $10.1205, sugar decreased 0.22 cents to 12.38 a pound and wheat decreased 5.0 cent to $5.66 a bushel.

In metals trading, copper prices fell 4.60 cents to $1.3875 a pound, gold increased $6.50 to $856.60 per ounce and silver was increased 6.50 cents to $11.39.