U.S. Treasury Yields, Stocks Rise

123jump.com Staff
25 Mar, 2009
New York City

U.S. stocks closed higher on better than expected rise in durable goods orders and new home sales in February. U.S. Treasury auction yields rose despite the Fed purchase of 22% of the $34 billion of five year note offering. Separately, the UK debt auction failed to cover, first time since 2002.

5:00PM New York, 11:00PM Frankfurt, 8:00AM Sydney[R]– U.S. stocks closed higher on better than expected rise in durable goods orders and new home sales in February. U.S. Treasury auction yields rose despite the Fed purchase 20% of the $34 billion of five year note offering. Separately, the UK debt auction failed to cover, first time since 2002. Japan exports plunged sharply in February. [/R]

Global Markets

U.S. stocks edged higher after the unexpected rise in durable goods orders in February. New home sales increased 4.7% in the month to annual rate of 337,000. The latest economic data was third in a series of economic news after the release of existing home sales and retail sales. Stocks edged higher.

UK government debt sale falls short to cover the auction and the debt auction cover in the U.S. dropped to 2.02 from the previous average of 2.18. U.S. Treasury auction of five year note was completed at a higher than expected yield of 1.849%, surprising many market participants. The yields increased despite the Fed buying $7.5 billion of the $34 billion of Treasury notes.

Stocks in Tokyo closed higher for the eight day in a row on the optimism that the world economies may recover as wealthiest nations commit more funds ahead of G20 nations meeting in London on April 2. Market ignored the sharp plunge in exports in February data.

European stocks disregarded discouraging economic data generated and extended gains for a third day this week. Business confidence in Germany, Europe’s largest economy slumped, to a record low since 1982. Siemens, one of Germany’s largest engineering firms, fell in Frankfurt after cautioning that markets were under a worsening stress. Trading was mixed for carmakers and financials.

The euro gained $1.3573 on news that the US was going to increase the use of IMF’s special drawing rights.

The UK government failed to attract buyers to finish its auction for treasury securities known as gilts. Investors shied away from the long dated maturities when the inflation is on the rise, pound is weak and government is planning to huge amount of debt.

J. Sainsbury Plc same store sales including fuel in the fourth quarter gained at the slowest pace. Legal & General dropped 7.2% after it reported 2008 net loss of 1.1 billion pounds and cut its dividend by half to 2.05 pence.

North American Markets

Dow Jones Industrial Average gained 89.84 or 1.2% to a close of 7,749.81, S&P 500 Index added 7.76 or 0.96% to 813.88, and Nasdaq Composite Index increased 12.43 or 0.8% to close at 1,528.95.

Of the stocks in S&P 500 index, 316 increased, 178 declined and 6 were unchanged.

SLM Corp led decliners in the S&P 500 index with a loss of 13.1% followed by losses in AIG with a loss of 11.7%, International Paper Company of 11.2%, in Dean Foods Company of 8%, in Aflac Inc of 7.6% and in Dynegy Inc of 6.7%.

CB Richard Ellis led gainers in the S&P 500 index with a rise of 58% followed by gains in Jabil Circuit of 37%, in CIT Group Inc of 9.6%, in Capital One Finance of 8.7% and in Whirlpool Corp of 8.3%.

South American Markets Indexes

Mexico Bolsa Index increased 30.16 or 0.15% to 20,272.77. Brazil Bovespa Stock Index added 196.16 or 0.47% to 41,671.99.

Argentina markets gained 0.7%, Chile added 0.6% and Peru surged 4.4%. Venezuela added 1.7% and Colombia decreased 0.1%.

Europe Markets Review

In London FTSE 100 Index closed lower 11.21 or 0.29% to 3,900.25, in Paris CAC 40 Index increased 19.06 or 0.66% to close at 2,893.45 and in Frankfurt DAX index higher 35.93 or 0.86% to close at 4,223.29. In Zurich trading SMI increased 46.72 or 0.95% to close at 4,970.38.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 8.31 or 0.10% to 8,479.99, Hang Seng index in Hong Kong decreased 288.23 or 2.07% closed to 13,622.11, CSI 300 index in China lower 50.46 or 2.06% closed to 2,401.33. ASX 200 index in Australia increased 29.30 or 0.82% closed to 3,609.30. The KL Composite index in Malaysia higher 0.89 or 0.10% closed to 878.81.

The Kospi Index in South Korea increased 7.32 or 0.60% to close at 1,229.02. SET index in Thailand closed lower 1.24 or 0.28% to 436.92 and JSE Index in Indonesia decreased 16.14 or 1.12% closed to 1,419.97. The Sensex index in India increased 196.86 or 2.08% closed to 9,667.90.

Commodities, Metals, and Currencies

Crude oil decreased $1.15 to close at $52.83 a barrel for a front month contract, natural gas increased 2 cents to $4.33 per mBtu and gasoline futures decreased 1.01 cents to close at 149.25 cents per gallon.

Wheat futures closed down 27 cents in Chicago trading and closed at $5.08 a bushel. Sugar decreased 18 cents in trading at 12.82 cents a pound. Soybean future closed down 16 cent to $9.51 a bushel.

Gold increased $14.80 in New York trading to close at $940.80 per ounce, silver closed up $0.148 to $13.51 per ounce and copper for the front month delivery decreased 1.40 cents to $1.7972 per pound.

Dollar edged lower against euro to $1.36 and dropped against yen to 97.38.

Yields on 10-year U.S. bonds increased to 2.78% and with 30-year maturities increased to 3.73%.