U.S. Markets Rebound on Service Index

Mukesh Buch
05 Oct, 2009
New York City

U.S. stocks rebounded as the service sector industry showed an expansion in September. Stocks in resource, technology and banking sector closed higher. Gold and oil edged up. Alcoa is scheduled to release earnings on Oct 7 to kick off third quarter earnings.

[R]4:30 PM New York, 9:30 PM London, 6:30 AM Sydney – U.S. stocks rebounded as the service sector industry showed an expansion in September. Stocks in resource, technology and banking sector closed higher. Gold and oil edged up. Alcoa is scheduled to release earnings on Oct 7 to kick off third quarter earnings.[/R]

Stocks in New York trading closed higher after service index showed a growth in September. Market indexes advanced led by retailers, banks and technology companies. Stocks in resource sector also closed higher as oil and metal prices closed higher.

Institute of Supply Management non-manufacturing index increased to 50.9 in September from 48.4 in August. The index above 50 indicates a growth in the sector and below shows a contraction.

Boston Scientific declined after it reached settlement agreement with a subsidiary of Johnson & Johnson. Blackstone Group is interested in acquiring theme park business of Anheuser-Busch InBev NV. Brocade Communications surged after the company is looking for a buyer.

European markets closed higher as commodities gained and resource stocks led the gainers. Stocks in the region firmed up after talks of strong dollar from central bankers failed to sway markets.

UK stocks edged higher after a week of slide that prompted analysts to recommend mining stocks. Anglo American increased on a speculation that China based Baosteel is interested in its Brazilian iron ore operations. Chemring Group wins lucrative US defense contract.

Stocks in Mumbai declined after rising last week. Rupee advanced to 47.51 against a dollar. Bharti Airtel fell 8% on a brokerage downgrade. Grasim Industries fell after company transferred the cement unit to an unlisted subsidiary before the merger with Ultratech controlled by Aditya Birla Group.

North American Markets

Dow Jones Industrial Average increased 112.08 or 1.2% to a close of 9,599.75, S&P 500 Index added 15.24 or 1.5% to 1,040.45, and Nasdaq Composite Index added 20.04 or 1% to close at 2,068.15. Toronto TSX Composite Index increased 151.56 or 1.4% to 11,109.89.

Of the stocks in S&P 500 index, 444 increased, 53 declined and 3 was unchanged.

MBIA led the decliners in the S&P 500 index with a loss of 6.7% followed by losses in Ciena Corporation of 3.3%, in Sprint Nextel Co of 2.6%, in King Pharmaceuticals of 2.6% and in DeVry Inc of 1.5%.

Nordstrom Inc led gainers in the S&P 500 index with a rise of 9.4% followed by gains in Convergys Corporation 9%, in Capital One Financial of 8.1% and in Limited Brands of 7.7% and in Wells Fargo & Company of 7.1%.

South American Markets Indexes

Mexico Bolsa Index increased 535.74 or 1.9% to 29,214.40 and Brazil Bovespa Stock Index increased 1,197.31 or 2% to 62,369.30.

Argentina Merval Index closed up 1.4% and Chile Stock Market Select index added 1.2%, Peru Lima General Index edged up 1.2% and Colombia IGBC General Index increased 0.93%.

Europe Markets Review

In London FTSE 100 Index closed higher 35.63 or 0.71% to 5,024.33, in Paris CAC 40 Index increased 25.11 or 0.69% to close at 3,675.01, in Frankfurt DAX index higher 40.95 or 0.75% to close at 5,508.85. In Zurich trading SMI increased 12.73 or 0.21% to close at 6,162.90.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 57.38 or 0.59% to 9,674.49, Hang Seng index in Hong Kong increased 53.58 or 0.26% to 20,429.07, ASX 200 index in Australia decreased 28.40 or 0.62% to 4,573.30. The FTSE Bursa KL Composite index in Malaysia was higher 10.20 or 0.85% to 1,216.45. CSI 300 index in China were closed today.

The Kospi Index in South Korea decreased 37.73 or 2.29% to close at 1,606.90 SET index in Thailand closed lower 6.09 or 0.84% to 718.47. JSE Index in Indonesia increased 0.57 or 0.02% to 2,480.41. The Sensex index in India decreased 268.14 or 1.56% to 16,866.41.

Commodities, Metals, and Currencies

Crude oil increased $0.50 to $70.45 a barrel for a front month contract, natural gas edged up 28 cents to $4.99 per mBtu and gasoline increased 1.40 cents to 175.50 cents.

Soybean future closed unchanged to $8.85 a bushel. Wheat futures closed up 1.50 cents in Chicago trading to $4.427 a bushel. Sugar edged up 0.41 cents a pound to 24.19 cents.

Gold increased $12.30 in New York trading to close at $1,016.60 per ounce, silver closed up $0.36 to $16.59 per ounce and copper for the front month delivery increased 4.8 cent to $2.68 per pound.

Dollar edged lower against euro to $1.465 and closed higher against the Japanese yen to 89.54.

Yield on 10-year U.S. bonds decreased to 3.21% and with 30-year maturities advanced to 4.01%.