U.S., Global Sell-off; Hartford, Massey Fall

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

The downward momentum in global markets dragged New York stocks lower. A rise in dollar, weak commodities and tired rally dragged markets in Asia and New York. The prospect of more bank losses worried investors in Europe. The dollar edged higher against euro and crude oil and gold declined.

[R]4:00 PM New York, 9:00 PM London, 6:00 AM Sydney – The downward momentum in global markets dragged New York stocks lower. A rise in dollar, weak commodities and tired rally dragged markets in Asia and New York. The prospect of more bank losses worried investors in Europe.[/R]

Global markets declined after investors in Asia worried that recent gains are unsustainable, European banks and insurance companies face mounting losses at banks and the dollar gained. Resource and commodities stocks declined in New York trading. Federal Reserve Bank of New York said the new orders and shipments were weak in May. The U.S. housing market index in June declined on a jump in mortgage rates.

Lincoln National, the parent of life insurer Lincoln Financial Group planned to raise $1.1 billion from investors and tap $950 million from the U.S. Treasury. On the news, financials trade lower. Sealed Air closed $400 million debt offering.

European market indexes closed lower on weak mining, energy and financial stocks. Porsche is in talks with sovereign investment funds in the Middle East to raise as much as 2.5 billion euros. Steelmakers in Germany and Amsterdam trading lead the decliners in Europe.

UK stocks closed lower on worries of rising inflation, a prospect of slower economic recovery and increase government debt. UK plans to raise £5 billion in government bond offering this week.

Investors in Japan worried that premature talks of contingency talks to trim government bailout of banks and lower budget deficit at the summit of G-8 ministers may backfire. The talks of lower government spending dragged commodities lower. Sumitomo Mitsui Financial plunged 7% and it plans to raise $9.2 billion. Japan Tobacco surges after it acquires UK based Tribac Leaf.

Hong Kong stocks declined on a weakness in metals and mining sector. Shanghai closed higher. Foreign direct investment in China fell 18% in May. The yuan declined in Shanghai trading.

Stocks in Mumbai fell after Reliance Industries was ordered to sell natural gas at half the current sale price to Reliance Natural. The court order will end the feud between Ambani brothers. Net fund flows to domestic funds surge in May.

Australian stocks declined after metals closed lower. Goodman Group surges on talks of investment from China. Atlas Iron Limited surged 17% after it proposed public offering of A$117 million to fund iron ore mining expansion.

North American Markets

Dow Jones Industrial Average decreased 187.13 or 2.2% to a close of 8,612.13, S&P 500 Index decreased 22.49 or 2.4% to 923.72, and Nasdaq Composite Index edged lower 42.42 or 2.3% to close at 1,816.38. Toronto TSX Composite Index closed down 250.18 or 2.4% to 10,394.78.

Of the stocks in S&P 500 index, 21 increased, 478 declined and 1 was unchanged.

Hartford Financial led the decliners in the S&P 500 index with a loss of 11.2% followed by losses in Lincoln National Corp of 10.8%, in Massey Energy of 9.7%, in MBIA Inc of 8.7% and in CB Richard Ellis of 8.5%.

Huntington Bancshares Incorporated led gainers in the S&P 500 index with a rise of 8.9% followed by gains in of Legg Mason Inc 4.1%, in Tenet Healthcare of 3.6% and in Coach Inc of 2.7%.

South American Markets Indexes

Mexico Bolsa Index decreased 560.33 or 2.2% to 24,899.69. Brazil Bovespa Stock Index dropped 1,524.41 or 2.9% to 52,033.82.

Argentina Merval Index decreased 0.9%, Chile Stock Market Select index lost 0.4% and Peru Lima General Index declined 2.5%.

Europe Markets Review

In London FTSE 100 Index closed lower 115.94 or 2.61% to 4,326.01, in Paris CAC 40 Index decreased 106.56 or 3.20% to close at 3,219.58 and in Frankfurt DAX index declined 179.30 or 3.54% to close at 4,889.94. In Zurich trading SMI decreased 121.69 or 2.20% to close at 5,400.15.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 96.15 or 0.95% to 10,039.67.
ASX 200 index in Australia decreased 30.50 or 0.75% to 4,031.70.
The Kospi Index in South Korea decreased 16.17 or 1.13% to close at 1,412.42.

Hang Seng index in Hong Kong decreased 390.72 or 2.07% to 18,498.96.
CSI 300 index in China closed higher 59.91 or 2.06% to 2,966.19.
The Sensex index in India decreased 362.42 or 2.38% to 14,875.52.

The KL Composite index in Malaysia edged higher 1.02 or 0.09% to 1,091.17.
SET index in Thailand closed lower 16.63 or 2.65% to 611.92.
JSE Index in Indonesia decreased 21.07 or 1.01 % closed to 2,069.88.

Commodities, Metals, and Currencies

Crude oil decreased $1.52 to close at $70.52 a barrel for a front month contract, natural gas increased 33 cent to $4.18 per mBtu and gasoline increased 1.43 cents to 205.74 cents.

Wheat futures closed down 9.50 cents in Chicago trading to $5.75 a bushel. Sugar decreased 0.42 cent in trading at 15.90 cents a pound. Soybean future closed down 51 cents to $10.24 a bushel.

Gold decreased $11.40 in New York trading to close at $929.30 per ounce, silver closed down $0.81 to $14.07 per ounce and copper for the front month delivery decreased 8.05 cents to $2.30 per pound.

Dollar edged higher against euro to $1.38 and closed up against the Japanese yen to 97.84.

Yields on 10-year U.S. bonds decreased to 3.71% and with 30-year maturities closed down at 4.56%.