U.S. Stocks Reverse Course; Lennar, Horton Rise

123jump.com Staff
08 Jun, 2009
New York City

U.S. stocks reversed course in the afternoon as talks of recovery gained momentum. Commodities and crude oil prices declined. Home builders rebounded. Yields on U.S. Treasurys increased.

[R]5:00 PM New York, 10:00 PM London, 8:00AM Sydney – U.S. stocks reversed course in the afternoon as talks of recovery gained momentum. Commodities and crude oil prices declined. Home builders rebounded. Yields on U.S. Treasurys increased.[/R]

Investor hesitation was evident in New York trading. Stocks reversed the course in the afternoon and rebounded from the lows reached during the day and closed up. Tech stocks gains were trimmed after Google and Apple lost ground. Home builders turned positive and stocks of energy and commodities declined.

Inflation worries and rising government deficit continue to dog trader talks and investors worry that the Fed may have a tough balancing act between rising mortgage rates and containing government spending.

Verisign, the Internet domain registry declined after a court ruling that permitted trial against the company for anti-trust violations. Allied Irish Banks dropped 11% after the long term debt outlook was lowered for the second time this year.

The Bank of England proposed to expand the acceptable collateral in exchange of loans to corporations. Lloyds Banking to return £2.3 billion of bailout funds to the UK government. Barclays is in talks with BlackRock to sell its asset management unit. William Morrison surged on same store sales data.

Stocks in Japan increased after the U.S. unemployment in May was less than expected. Exporters led the gainers. JGC surged after the company was selected by Algerian state oil and gas company for $1.5 billion contract. Japan’s current account surplus drops 54.5% in April.

The benchmark indexes after rallying for thirteen weeks closed lower. Foreign investors added net $640 million or 2,600 crore rupees of stocks. Tata Steel shipment in May increased 18%. Indiabulls Real Estate reported quarterly loss. Airlines plunged after IATA doubled its estimate of losses.

The battle for copper and gold miner Oz Minerals heated up ahead of its annual meeting this week. OZ Mineral in a press release advised its shareholders to approve the deal with China based Minmetals and rejected non-binding recapitalization offer from its bankers.

North American Markets

Dow Jones Industrial Average increased 1.36 or 0.02% to a close of 8,764.49, S&P 500 Index decreased 0.95 or 0.1% to 939.14, and Nasdaq Composite Index edged lower 7.02 or 0.4% to close at 1,842.40. Toronto TSX Composite Index closed down 20.17 or 0.2% to 10,549.12.

Of the stocks in S&P 500 index, 189 increased, 303 declined and 7 were unchanged.

VeriSign, Inc led the decliners in the S&P 500 index with a loss of 14.2% followed by losses in Cigna Corp of 6.9%, in Qwest Communication of 5.7%, in Dynegy Inc of 5.3% and in Aetna Inc of 5.2%.

SLM Corporation led gainers in the S&P 500 index with a rise of 20% followed by gains in Lennar Corp of 5%, in D R Horton Inc of 4.9% and in DirectTV Group Inc of 4.3%.

South American Markets Indexes

Mexico Bolsa Index increased 19.87 or 0.08% to 24,932.88. Brazil Bovespa Stock Index gained 289.38 or 0.5% to 53,630.39.

Argentina Merval Index fell 0.8%, Chile Stock Market Select index decreased 0.5% and Peru Lima General Index declined 0.6%. Colombia IGBC General Index edged lower 0.4% and Venezuela Stock Market Index was unchanged.

Europe Markets Review

In London FTSE 100 Index closed lower 33.34 or 0.75% to 4,405.22, in Paris CAC 40 Index decreased 49.39 or 1.48% to close at 3,289.66 and in Frankfurt DAX index lower 72.31 or 1.42% to close at 5,004.72. In Zurich trading SMI decreased 7.18 or 0.13% to close at 5,391.72.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed higher 97.62 or 1.00% to 9,865.63, Hang Seng index in Hong Kong decreased 426.14 or 2.28% closed to 18,253.39, CSI 300 index in China higher 9.17 or 0.31% closed to 2,948.48.The KL Composite index in Malaysia lower 2.65 or 0.25% closed to 1,072.85.The Markets of Australia were closed today.

The Kospi Index in South Korea decreased 1.41 or 0.10% to close at 1,393.30. SET index in Thailand closed lower 4.54 or 0.75% to 600.03 and JSE Index in Indonesia decreased 22.28 or 1.07% closed to 2,056.65. The Sensex index in India decreased 437.63 or 2.90% closed to 14,665.92.

Commodities, Metals, and Currencies

Crude oil increased $0.18 to close at $68.62 a barrel for a front month contract, natural gas decreased 13 cent to $3.74 per mBtu and gasoline decreased 0.76 cents to 194.70 cents.

Wheat futures closed down 25.00 cents in Chicago trading and closed at $5.98 a bushel. Sugar decreased 0.16 cent in trading at 15.37 cents a pound. Soybean future closed up 7 cent to $12.32 a bushel.

Gold decreased $9.30 in New York trading to close at $953.30 per ounce, silver closed down $0.42 to $14.96 per ounce and copper for the front month delivery decreased 0.45 cents to $2.2795 per pound.

Dollar edged higher against euro to $1.3906 and closed down against the Japanese yen to 98.48.

Yields on 10-year U.S. bonds increased to 3.90% and with 30-year maturities closed unchanged at 4.64%.