World Markets Rise on U.S., Brazil Retail Sales

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

World markets edge ahead after the release of retail sales and producer prices index. Brazil and U.S. report rising retail sales and German investor confidence in September grows. Japan Airlines is planning to cut 6,800 jobs. Yahoo lowers its stake in the online marketplace operator Alibaba.com.

[R]10:30 AM New York – World markets edge ahead after the release of retail sales and producer prices index. Brazil and U.S. report rising retail sales and German investor confidence in September grows. Japan Airlines is planning to cut 6,800 jobs. Yahoo lowers its stake in the online marketplace operator Alibaba.com.[/R]

U.S. stocks attempted to trade higher after the release of retail sales and producer price index data. Asian markets closed mixed and European markers edged higher. Futures of crude oil increased 0.7% and natural gas surged 5.6%. Gold and silver traded near their recent highs.

U.S. 10-year bonds yielded 3.44% and 30-year bonds traded at 4.25% yield.

Brazil retail sales in July increased 0.5% from June and 5.9% from a year ago and Mexico completed the sale of Ps 32 billion backed by the oil revenues.

The latest read of German investor confidence in September surged after the recent rise in factory orders and exports. Separately, UK said inflation in August dropped to 1.6% but still ahead of most economists’ expectations as crude oil price rise.

Japan Airlines Corp, the heavily indebted airline plans to cut 6,800 jobs by fiscal 2011. The carrier is in talks with Delta and American Airlines that may lead to capital infusion of several hundred billion yen according to the government panel to restructure the airline.

Alibaba.com, the online listing company based in China and Hong Kong dropped 11% in Hong Kong after Yahoo began selling its stake in the company. Yahoo plans to lower its stake in the company by selling 57.5 million shares.

U.S. PPI and Retail Sales Rise in August

The Producer Price Index increased 1.7% in August after decreasing 0.9% in July and advancing 1.8% in June. The index dropped 4.3% from a year ago after falling 6.8% in July on an unadjusted basis. The 8% in energy prices contributed to 90% increase in the PPI index.

Total retail sales in August increased 2.7% from the previous month but fell 5.3% from a year ago month. Retail trade sales in the month increased 3% from July but 6% below last year. Gasoline stations sales were down 26.7% from a year ago and garden equipment and supplies sales declined 13.6% from last year.

The sales at auto dealers and parts in the month surged 11% on the government program.

Auto sales jumped after Obama administration offered up to $4,500 to exchange old cars with fuel efficient new cars. The program ended on August 24 has generated additional 700,000 car sales according to the Transportation Department.

Excluding auto, gasoline and building materials, sales increased 0.7% after falling 0.3% in July.

Treasury Prepares Citigroup Exit Plan

The U.S. Treasury is considering selling its stake in Citigroup as early as next month according to media speculation. The Treasury controls 7.69 billion shares which are trading above the conversion price of $3.25 a share.

Citigroup exchanged 7,692 shares of interim securities and warrants for $25 billion in private exchange offers on July 23. Each interim security automatically converts to one million common stocks. On July 29 Citi exchanged additional 3,846 interim securities with the government for $12.5 billion.

After the public and private exchange offers on July 23 and 29, U.S. Treasury controls 7.7 billion shares or 33.6% of total issued common stock.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed higher 15.56 or 0.15% to 10,217.62, Hang Seng index in Hong Kong decreased 68.83 or 0.31% to 20,866.37 and CSI 300 index in China higher 9.25 or 0.28% to 3,302.64. ASX 200 index in Australia increased 9.20 or 0.20% to 4,540.30. The FTSE Bursa KL Composite index in Malaysia closed higher 4.11 or 0.34% to 1,207.47.

The Kospi Index in South Korea increased 18.49 or 1.13% to close at 1,653.40. SET index in Thailand closed higher 8.84 or 1.27% to 703.16 and JSE Index in Indonesia increased 37.41 or 1.57% to 2,420.11. The Sensex index in India increased 240.26 or 1.48% to 16,454.45.

Europe Markets Review

In London FTSE 100 Index traded higher 13.89 or 0.28% to 5,032.74, in Paris CAC 40 Index increased 11.75 or 0.31% to 3,742.36 and in Frankfurt DAX index traded lower 3.92 or 0.07% to 5,616.32. In Zurich trading SMI decreased 13.89 or 0.22% to 6,211.75.

ASX 200 Index Movers

Lynas Corporation Limited led the decliners in the ASX 200 index of 5.0% followed by losses in FKP Property Group of 4.4%, in Telstra Corporation Limited of 4.3%, in Elders Limited of 4.2% and in Mincor Resources NL of 3.3%.

Macmahon Holdings Limited gainers in the ASX 200 index with a rise of 7.8% followed by gains in Harvey Norman Holdings Limited of 6.3%, in Spotless Group Limited of 5.0% and in Transfield Services Limited of 4.9%.

Nikkei 200 Average Movers

CSK Holdings Corporation led the decliners in the Nikkei 225 index of 4.5% followed by losses in Nippon Paper Group, Inc. of 3.6%, in Japan Airlines Corporation of 3.4 %, in Jtekt Corporation of 3.3% and in Citizen Holdings Co., Ltd. of 3.2%.

Daikin Indusrtries, Ltd.led gainers in the Nikkei 225 index with a rise of 5.0% followed by gains in Nisshin Seifun Group Inc. of 4.8%, in Shionogi & Co., Ltd. of 4.7% and in JGC Corporation of 3.2%.