U.S. Markets Rise on Retail Sales, Earnings

123jump.com Staff
12 Feb, 2009
New York City

U.S. stocks edged higher after retail sales gained and on optimism on the economic stimulus package. Investors are still looking for clues to the details of the economic package and bank bailout plan. Better than expected earnings at Coca Cola Company also lifted market sentiment.

[R]5:00PM New York – 11:00PM Frankfurt, 4:00AM Sydney – U.S. stocks edged higher on better than expected retails sales in January. Economy in the fourth quarter may have shrink 10.6%, the largest decline in fifty five years.[/R]

U.S. stocks edged higher after retail sales gained and on optimism on the economic stimulus package. Investors are still looking for clues to the details of the economic package and bank bailout plan. Better than expected earnings at Coca Cola Company also lifted market sentiment.

European markets dropped on weakness in autos and banks. DAX index dropped 2.7% and CAC 40 index declined 2.1%. Volkswagen plunged 7% after the U.S. stimulus watered down the subsidies to the auto sector. Renault reported a sharp decline of 78% in earnings on 4.1% decline in sales.

London stock fell 0.8% after BT Group projected that pension deficit will soar to £1 billion next year. The telecom company also reported that operating profit in the third quarter ended December 31 plunged 62% to £277 million from a year ago. Rio Tinto in US$19.5 billion deal with Chinalco.

Stocks in Tokyo trading dropped sharply after a private think tank projected economic contraction at annual rate of 10.6%, the first double digit decline in more than fifty years. Separately, Bank of Japan reported 0.2% decline in wholesale price index.

China coal exports fall 36.3% to 3.66 million tons in January. China approves stimulus package for shipbuilding industry. Chinalco agrees to invest $20 billion in Rio Tinto. Chinalco agreed to a $13 billion asset sale and $7 billion convertible note issue with Rio Tinto today.

In Mumbai trading stocks declined after industrial production fell. The index for production fell 2% in December from a year ago and is likely to remain weak for January month as well. The annualized measure of inflation at the end of January declined to 4.4% from 5.07% a week ago period.

Rio Tinto will sign a US$13 billion asset sale and US$7 billion convertible note issue with Chinalco today. The sale is part of the company effort to lower its debt load. Australian employment rate rises 1.2% to 10.7 million in January.


American Markets Reviews

Dow Jones Industrial Average declined 6.8 or 0.1% to a close of 7,932.76, S&P 500 increased 1.45 or 0.17% to 835.19, and Nasdaq Composite Index added 11.21 or 0.73% to a close of 1,541.71. In Toronto TSX Composite added 40.89 or 0.5% to close at 8,778.78.

In Latin American trading Brazil Bovespa Index decreased 0.8% or 344.83 to 40,500.79 and Mexico Bolsa Index dropped 0.5% or 88.40 to 19,358.25.

Argentina fell 2.1%, Chile dropped 0.7%, Peru decreased 0.6% and Colombia edged lower 0.8%. Venezuela gained 0.4%.

U.S. Stock Movers

Of the stocks in S&P 500 index, 271 increased, 221 declined and 8 were unchanged.

Capital One Financial led the decliners in the S&P 500 index with a loss of 9.1% followed by losses in US Bancorp with a loss of 8.9%, in Harley Davidson of 8.3%, in SunTrust Bank of 8.3%, in Hartford Financial Services of 7.7%. Masco Corp dropped 7.4% and Zions Bancorp declined 7.4%.

Life Technologies led gainers in the S&P 500 index with a rise of 9.4% followed by gains in Tesoro Corp of 3.2%, in NetApp Inc of 7.9%, in Coca Cola Company of 7.6% and Teradata Corp of 7.5%.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 240.58 or 3.03% to 7,705.36, Hang Seng index in Hong Kong decreased 310.91 or 2.30% closed to 13,228.30, CSI 300 index in China lower 12.80 or 0.55% closed to 2,318.34. ASX 200 index in Australia increased 39.90 or 1.15% closed to 3,514.30. The KL Composite index in Malaysia lower 2.47 or 0.28% closed to 894.60.

The Kospi Index in South Korea decreased 10.34 or 0.87% to close at 1,179.84. SET index in Thailand closed lower 3.47 or 0.78% to 440.63 and JSE Index in Indonesia increased 0.60 or 0.05% closed to 1,325.42. The Sensex index in India decreased 152.71 or 1.59% closed to 9,465.83.

Europe Markets Review

In London FTSE 100 Index closed lower 32.02 or 0.76% to 4,202.24, in Paris CAC 40 Index decreased 63.38 or 2.09% to close at 2,964.34 and in Frankfurt DAX index lower 122.53 or 2.70% to close at 4,407.56. In Zurich trading SMI decreased 17.10 or 0.33% to close at 5,106.67.

Commodities, Bonds and Currencies

Yields on 10-year bond increased to 2.78% and on 30-year bonds gained to 3.52%.

The U.S. dollar edged higher to $1.2878 to a euro and against the Japanese yen inched lower to 90.88 yen.

Immediate futures prices of Texas crude oil decreased $1.67 to $34.27 a barrel, for natural gas decreased $0.04 cent to $4.50 per mbtu and gasoline prices increased 1.13 cents to 125.85 cents a gallon.

Futures of corn decreased 2.25 cent to $3.66, soybean decreased 10.50 cents to $9.71, sugar decreased 1 cent to 13.49 a pound and wheat decreased 4.50 cent to $5.51 a bushel.

In metals trading, copper prices increased 1.30 cents to $1.5535 a pound, gold increased $3.10 to $947.60 per ounce and silver decreased 4.5 cents to $13.48.