U.S Joins World Markets Rally; Lenders Fall

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

U.S. stocks participated in a world market rally as commodities prices rise in Asia and Europe and brokers lift outlook for retailers and technology companies. The dollar firmed but traded near its low for the year. Student lenders fall.

[R]10:45 AM New York – U.S. stocks participated in a world market rally as commodities prices rise in Asia and Europe and brokers lift outlook for retailers and technology companies. The dollar firmed but traded near its low for the year. Student lenders fall.[/R]

U.S. markets gained in morning trading after Asian markets closed higher and European markets advanced. Dollar edged lower and gold and silver regained their footing in London and New York trading.

Asian Development Bank lifted its economic outlook for China, India and Indonesia. The regional bank revised India growth to 6% from 5% and China growth to 8.2% from 7%. The bank estimates growth in developing Asia that excludes Japan to increase to 3.9% from 3.4% estimate in March and 2010 estimate to 6.4% from 6%.

The leaders of twenty industrialized nations are expected to meet for a two-day summit in Pittsburgh, Pennsylvania.

Crude oil futures edged up $1.15 to $70.86 and gold futures increased $10.30 to $1,015 per ounce.

Yields on 10-year U.S. bonds traded at 3.45% and 30-year bond at 4.22%

Gainers & Losers

Bank of America, Hewlett Packard and Macy’s increased after ratings revisions from brokers lifted stocks.

AIG gained more than 8% in the early trading after Chairman Ed Towns of House Oversight and Government Reform Committee indicated that he will give serious consideration to relax terms of the company bailout.

MBIA Inc surged 16.6% on the AIG news.

Student loans lenders and private education colleges fell after the U.S. House passed a bill that will eliminate the private lending activity in the student loan market. All loans will be administered by the US Department of Education.

ITT Educational Services fell 5.4%, SLM Corp declined 1.5%, Corinthian Colleges fell 4.3% and Apollo Group decreased 4.7%.

Earnings Review

CarMax, Inc, the car dealership chain reported second quarter sales rose 13% to $2.08 billion from $1.84 billion a year ago. Net income in the quarter rose 636% to $103 million or 46 cents per diluted share compared to net income of $14 million or 6 cents per share a year ago.

Carnival Corporation, the cruise line company reported third quarter revenues fell 14% to $4.14 billion from $4.81 billion a year ago. Net income in the quarter fell 19.5% to $1.07 billion or $1.33 per diluted share compared to net income of $1.33 billion or $1.65 per share a year ago.

FactSet Research Systems Inc, the provider of integrated financial information reported fourth quarter revenues rose 1.1% to $155.5 million from $153.7 million a year ago. Net income in the quarter rose 8% to $36.3 million or 74 cents per diluted share compared to net income of $33.6 million or 67 cents per share a year ago.

Revenues for the fiscal year 2009 rose 8% to $622 million from $575.5 million a year ago. Net income for the year rose 16% to $145 million or $2.97 per diluted share compared to net income of $125 million or $2.50 per share a year ago.

Asian Markets Review

Hang Seng index in Hong Kong increased 228.29 or 1.06% to 21,701.14 and CSI 300 index in China closed lower 77.58 or 2.42% to 3,131.03. ASX 200 index in Australia decreased 13.70 or 0.29% to 4,663.70. The Nikkei 225 Index in Tokyo, The FTSE Bursa KL Composite index in Malaysia was closed today.

The Kospi Index in South Korea increased 23.38 or 1.38% to close at 1,718.88. SET index in Thailand closed higher 11.21 or 1.57% to 724.37. The Sensex index in India increased 145.13 or 0.87% to 16,886.43. Markets in Indonesia and Japan were closed today.

Europe Markets Review

In London FTSE 100 Index traded higher 44.86 or 0.87% to 5,179.22, in Paris CAC 40 Index increased 34.15 or 0.90% to 3,846.31 and in Frankfurt DAX index traded higher 71.07 or 1.25% to 5,739.72. In Zurich trading SMI increased 71.33 or 1.13% to 6,377.56.