U.S. Stocks Rise; Trade Deficit Narrows

123jump.com Staff
09 Oct, 2009
New York City

U.S. stocks closed higher for the fifth day in a row ahead of earnings. Stocks Citigroup sells its trading commodities unit to Occidental Petroleum Corp for $250 million. U.S. trade deficit narrows 3.5% in August.

[R]4:30 PM New York, 9:30 PM London, 6:30 AM Sydney – U.S. stocks closed higher for the fifth day in a row ahead of earnings. Stocks Citigroup sells its trading commodities unit to Occidental Petroleum Corp for $250 million. U.S. trade deficit narrows 3.5% in August.[/R]

Stocks in New York edged higher after brokers recommended tech stocks. Dollar hovered near its low and gold decreased in volatile trading. President Barack Obama won 2009 Nobel Peace Prize for his efforts to strengthen global diplomacy and cooperation.

IBM, Google and Research in Motion gained on broker recommendations. Tata Motors completed its $750 million offering. Infosys fell after quarterly net income fell 1%. Sunrise Senior Living surged 24% after it sold nursing home care facilities.

Citigroup agreed to sell its one of the most consistent earnings producer, Phibro LLC to Occidental Petroleum Corp for $250 million. The sale averted the potential conflict between the Obama administration and the bank over a compensation to its chief executive that totaled $100 million in 2008.

The unit between 1997 and second quarter of 2009, averaged approximately $200 million per year in pre-tax earnings while over the last five years Phibro''s earnings averaged $371 million per year. Phibro has been profitable each fiscal year since 1997.

The U.S international trade deficit narrowed in August 3.5% from July to $30.71 and plunged nearly 50% from a year ago $59.1 billion.

UK stocks closed nearly unchanged as the pound fell against the dollar and the euro. Currency analysts are predicting the pound to trade below 95 euro cents by the end of the year. The troubled retailed JJB Sports to raise £100 million. Songbird Estate dropped on weak uptake in rights offering.

European markets closed nearly unchanged as the euro advanced against the pound and held firm against the dollar. German exports declined in September and trade surplus decreased 28%. Industrial output in France and Italy increased in August.

North American Markets

Dow Jones Industrial Average increased 78.07 or 0.8% to a close of 9,864.94, S&P 500 Index added 6.01 or 0.6% to 1,071.49, and Nasdaq Composite Index added 15.35 or 0.7% to close at 2,139.28. Toronto TSX Composite Index decreased 47.59 or 0.4% to 11,436.92.

Of the stocks in S&P 500 index, 356 increased, 139 declined and 5 were unchanged.

Discover Financial led the decliners in the S&P 500 index with a loss of 5.2% followed by losses in Yahoo! Inc of 4.1%, in MetroPCS Communications of 3.7%, in Wynn Resorts Ltd of 3% and in Supervalu of 2.0%.

Spectra Energy Corp led gainers in the S&P 500 index with a rise of 4.1% followed by gains in LSI Corporation 3.3%, in National Semiconductor Corporation of 2.9% and in NetApp, Inc of 2.9%.

South American Markets Indexes

Mexico Bolsa Index increased 140.86 or 0.5% to 30,039.71 and Brazil Bovespa Stock Index added 311.14 or 0.5% to 64,071.01.

Argentina Merval Index closed advanced 0.9% and Chile Stock Market Select index increased 0.8%, Peru Lima General Index increased 2.4% and Colombia IGBC General Index decreased 1%.

Europe Markets Review

In London FTSE 100 Index closed higher 7.23 or 0.14% to 5,161.87, in Paris CAC 40 Index decreased 7.20 or 0.19% to close at 3,799.61, in Frankfurt DAX index lower 4.66 or 0.08% to close at 5,711.88. In Zurich trading SMI decreased 14.16 or 0.22% to close at 6,291.64.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed higher 183.92 or 1.87% to 10,016.39, Hang Seng index in Hong Kong increased 6.54 or 0.03% to 21,499.44, and CSI 300 index in China higher 158.90 or 5.29% to 3,163.71. ASX 200 index in Australia decreased 15.70 or 0.33% to 4,752.90. The FTSE Bursa KL Composite index in Malaysia was higher 3.73 or 0.30% to 1,233.82.

The Kospi Index in South Korea increased 31.33 or 1.94% to close at 1,646.79 SET Index in Thailand closed higher 2.84 or 0.38% to 746.87. JSE Index in Indonesia decreased 10.12 or 0.41% to 2,474.40. The Sensex Index in India decreased 200.88 or 1.19% to 16,642.66.

Commodities, Metals, and Currencies

Crude oil increased $0.59 to $71.38 a barrel for a front month contract, natural gas edged down 19 cents to $4.77 per mBtu and gasoline increased 29 cents to 178.26 cents.

Soybean future closed up 28 cents to $9.64 a bushel. Wheat futures closed down 6.00 cents in Chicago trading to $4.68 a bushel. Sugar edged down 1.30 cents a pound to 21.24 cents.

Gold decreased $6.20 in New York trading to close at $1,050.10 per ounce, silver closed down $0.08 to $17.73 per ounce and copper for the front month delivery decreased 4.40 cent to $2.8545 per pound.

Dollar edged higher against euro to $1.4720 and closed up against the Japanese yen to 89.81.

Yield on 10-year U.S. bonds increased to 3.38% and with 30-year maturities advanced to 4.23%.