Stress Test Anxieties; World Markets Pause

123jump.com Staff
05 May, 2009
New York City

U.S. stocks edged lower after rallying for days on the hopes that banks are adequately capitalized and economy is in the bottoming out process. European banks closed higher after UBS reported smaller than expected loss. Alcatel loss widened. Demag Cranes orders plunged.

[R]4:00PM New York, 10:00PM Frankfurt – U.S. stocks edged lower after rallying for days on the hopes that banks are adequately capitalized and economy is in the bottoming out process. European banks closed higher after UBS reported smaller than expected loss. Alcatel loss widened. Demag Cranes orders plunged.[/R]

U.S. stocks traded volatile as service industry index showed a smaller decline in April. Fed chairman in his prepared remarks focused on fragile economic conditions and indicated that banks will have to increase equity capital and the central bank is prepared to help. Legg Mason reported a larger loss compared to a year ago and D R Horton quarterly loss declined.

European stocks declined after rally in recent days ran out of steam. Banks increased after UBS reported smaller than expected loss. Adidas AG and Metro AG declined on weak earnings. German auto sales increased 14% in April.

Hong Kong gained on the back of a rise in optimism in the U.S. The benchmark index has recovered 45% from its lows of March 10 and continues to gain as investor sentiment rebound. Li & Fung declined 8% after it planned to raise $350 million from the controlling shareholder.

Stocks in Mumbai trading today were unchanged after a rally of 6.4%. DLF surged after it planned to raise capital and sell its non-core assets. Sobha Developers board approved capital increase and sell of the company to foreign institutional investors. Tata Motors reported a surge in Nano bookings.

North American Markets

Dow Jones Industrial Average decreased 16.09 or 0.19% to a close of 8,410.65, S&P 500 Index lost 3.44 or 0.4% to 903.80, and Nasdaq Composite Index decreased 9.44 or 0.5% to close at 1,754.12. In Toronto TSX Composite Index increased 10.35 or 0.10% to 9,880.72.

Of the stocks in S&P 500 index, 211 increased, 284 declined and 5 were unchanged.

Legg Mason led decliners in the S&P 500 index with a loss of 17.3% followed by losses in Chesapeake Energy of 10.6%, in Archer Daniels Midland of 8.9%, in Avon Products of 8.5%, in DR Horton Inc of 8.5% and in AK Steel Holding of 8.1%.

AIG led gainers in the S&P 500 index with a surge of 19% followed by gains in Wynn Resorts of 16.8%, in Genworth Financial of 16.4%, in Qwest Communications of 14.6%, in MBIA Inc of 14.6% and in CIT Group Inc of 12.8%.

South American Markets Indexes

Mexico Bolsa Index increased 416.19 or 1.8% to 23,430.24. Brazil Bovespa Stock Index gained 265.25 or 0.53% to 50,669.78.

Argentina Merval Index gained 0.8%, Chile Stock Market Select index increased 0.7% and Peru Lima General Index added 2.6%. Colombia IGBC General Index edged up 0.06% and Venezuela Stock Market Index closed flat.

Europe Markets Review

In London FTSE 100 Index closed higher 93.72 or 2.21% to 4,336.94, in Paris CAC 40 Index decreased 12.97 or 0.40% to close at 3,225.00 and in Frankfurt DAX index lower 49.42 or 1.01% to close at 4,853.03. In Zurich trading SMI decreased 37.41 or 0.70% to close at 5,280.93.

Asian Markets Review

The Hang Seng index in Hong Kong increased 49.03 or 0.30% closed to 16,430.08, CSI 300 index in China higher 12.71 or 0.47% closed to 2,727.01. ASX 200 index in Australia increased 7.40 or 0.19% closed to 3,890.40. The KL Composite index in Malaysia lower 0.49 or 0.05% closed to 1,008.87.The Markets of Tokyo were closed today.

The JSE Index in Indonesia decreased 16.08 or 0.90% closed to 1,772.07. The Sensex index in India decreased 3.67 or 0.03% closed to 12,131.08. The Markets of South Korea and Thailand were closed today.

Commodities, Metals, and Currencies

Crude oil decreased $0.54 to close at $53.93 a barrel for a front month contract, natural gas decreased 11 cent to $3.61 per mBtu and gasoline futures decreased 1.30 cents to close at 157.29 cents per gallon.

Wheat futures closed up 2.50 cents in Chicago trading and closed at $5.53 a bushel. Sugar increased 0.13 cent in trading at 15.15 cents a pound. Soybean future closed down 2.50 cent to $11.01 a bushel.

Gold decreased $3.30 in New York trading to close at $898.90 per ounce, silver closed up $0.22 to $13.33 per ounce and copper for the front month delivery decreased 7.30 cents to $2.07 per pound.

Dollar edged higher against euro to $1.3329 and closed down against yen to 98.97.

Yields on 10-year U.S. bonds increased to 3.16% and with 30-year maturities closed unchanged at 4.06%.