Cisco Outook Powers Techs; World Markets Up

Mukesh Buch
05 Nov, 2009
New York City

U.S. stocks surged after reports on productivity and weekly jobless claims pleased investors. CVS plunged after it reported larger than expected client losses at its pharmacy benefit division. Hyatt and Ancestry.com IPO close up. Cisco outlook powered tech stocks with the Nasdaq index up 2.4%.

[R]4:30 PM New York, 9:30 PM London, 8:30 AM Sydney – U.S. stocks surged after reports on productivity and weekly jobless claims pleased investors. CVS plunged after it reported larger than expected client losses at its pharmacy benefit division. Cisco outlook powered tech stocks.[/R]

U.S. stocks edged higher after the weekly jobless claims declined 20,000 in the last week and productivity increased at the fastest pace of 9.5%. Cisco, Whole Foods and Research in Motion traded higher.

Hyatt Hotels Corp ((H)) priced its 38 million shares offering at $25 a share and closed up 12% to $28. Ancestary.com sold7.4 million shares priced at $13.50 a share and raised $100 million. The stock closed up 5.2% to $14.20.

Tech stocks charged ahead of Cisco indicated in a conference call that current quarter revenues will be higher than a year ago quarter after falling for four quarters.

CVS Caremark Corporation plunged 20% after it reported 92% customer retention rate in its pharmacy benefit division, whereas retention at the competitor Medco Health is 99%. Whole Foods plunged 15% after it reported weaker than expected earnings. Children’s Place Retail increased after it reported monthly sales increase. Cisco System gained 2.6% on positive outlook.

The Bank of England left its key lending rate unchanged at 0.5% and increased the Treasury bond purchase plan by 25 billion. Cable & Wireless dropped after it plans to split into two separate companies. Vedanta Resource fell. Invensys Plc dropped on weaker than expected sales.

The ECB left its key lending rate unchanged at 1% and indicated a gradual winding of various direct lending programs. Deutsche Telekom third quarter net profit rises 7.2%. Enel SpA third quarter net profit fell 43%. BNP Paribas third quarter profit rose 43%. Ubisoft SA surged on annual outlook.

Tax collection in India increased 3.9% in the first seven months in fiscal year indicating rising income of corporations and individuals. Wireless telecoms rebounded on the talks of lower connection fees. Larsen & Toubro unit and Patni are in merger discussion.

North American Markets

Dow Jones Industrial Average increased 203.82 or 2.1% to a close of 10,005.96, S&P 500 Index added 20.13 or 1.9% to 1,066.63, and Nasdaq Composite Index surged 49.80 or 2.4% to close at 2,105.32. Toronto TSX Composite Index increased 109.50 or 1% to 11,180.70.

Of the stocks in S&P 500 index, 463 increased, 34 declined and 2 were unchanged.

CVS Caremark Corporation led the decliners in the S&P 500 index with a loss of 20.1% followed by losses in Whole Foods Market, Inc of 15.5%, in Metro PCS Communications of 9.2%, in MBIA Inc of 7.7%, in CF Industries of 7.5% and in J. C. Penney Company, Inc of 5.5%.

IMS Health Incorporated led gainers in the S&P 500 index with a rise of 23.3% followed by gains in Eastman Kodak of 13%, in Dynegy Inc of 9.6%, in AIG of 8.5% and in Wynn Resorts Ltd of 8.3%.

South American Markets Indexes

Mexico Bolsa Index increased 304.83 or 1% to 29,735.34 and Brazil Bovespa Stock Index added 903.15 or 1.4% to 64,815.72.

Argentina Merval Index decreased 0.9% and Chile Stock Market Select index added 0.1% and Colombia IGBC General Index advanced 1.7% and Peru Lima General Index added 0.6%.

Europe Markets Review

In London FTSE 100 Index closed higher 41.56 or 0.81% to 5,149.45, in Paris CAC 40 Index increased 51.59 or 1.41% to close at 3,721.92, in Frankfurt DAX index higher 59.72 or 1.10% to close at 5,503.95. In Zurich trading SMI increased 29.49 or 0.47% to close at 6,296.60.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 126.87 or 1.29% to 9,717.44, and Hang Seng index in Hong Kong decreased 135.69 or 0.63% to 21,479.08, and CSI 300 index in China higher 10.43 or 0.30% to 3,464.32. ASX 200 index in Australia decreased 32.10 or 0.71% to 4,508.00. The FTSE Bursa KL Composite index in Malaysia was higher 0.12 or 0.01% to 1,253.96.

The Kospi Index in South Korea decreased 27.69 or 1.75% to close at 1,552.24. SET index in Thailand closed lower 4.50 or 0.66% to 681.91. JSE Index in Indonesia decreased 4.64 or 0.20% to 2,367.21. The Sensex index in India increased 151.77 or 0.95% to 16,063.90.

Commodities, Metals, and Currencies

Crude oil decreased $0.67 to $79.73 a barrel for a front month contract, natural gas edged up 8 cents to $4.81 per mBtu and gasoline decreased 2.50 cents to 198.76 cents.

Soybean future closed down 27.00 cents to $9.72 a bushel. Wheat futures closed down 8.75 cents in Chicago trading to $5.121 a bushel. Sugar closed lower 83 cents 22.76 cents.

Gold increased $3.70 in New York trading to close at $1,091.00 per ounce, silver closed up $0.06 to $17.42 per ounce and copper for the front month delivery decreased 2.30 cent to $2.96 per pound.

Dollar edged lower against euro to $1.4869 and edged up against the Japanese yen to 90.73.

Yield on 10-year U.S. bonds were unchanged to 3.52% and with 30-year maturities closed unchanged to 4.40%.