U.S. Stocks Rebound; Oil Falls, Gold Up

Mukesh Buch
06 Nov, 2009
New York City

The record unemployment rate in three decades cast doubts on the economic health. Stocks in New York closed higher and three popular indexes rebounded in the afternoon. Gold futures hovered near its record highs. Starbucks earnings rise on cost cutting. Crude oil fell. German factory orders rise.

[R]4:30 PM New York, 9:30 PM London, 8:30 AM Sydney – The record unemployment rate in three decades cast doubts on the economic health. Stocks in New York closed higher and three popular indexes rebounded in the afternoon. Gold futures hovered near its record highs. Starbucks earnings rise on cost cutting. Crude oil fell. German factory orders rise.[/R]

October unemployment surged to 10.2%, record since 1983 as builders, factories and services cut staff. Payrolls declined 19,000 in the month and the jobless rate increased from 9.8% in September. Stocks turned higher in the afternoon after trading lower for the most of the session.

International Game Technology led gainers in the S&P 500 index on better than expected earnings. Blue Nile, the online jeweler rises after it lifts annual outlook. Starbucks reports strong quarterly results on cost cutting. Sotheby’s loss widens on weak auction environment.

Global corporations are still struggling as the U.S. financial crisis expands to a global economic slowdown. Banks in China, India, Brazil and Australia are reporting rising earnings and revenues. Software services providers in India have returned to growth.

European markets traded sideways after a string of weak results in Germany and France. German factory orders increased in September. Deutsche Boerse net declined and placed its final bid for the Warsaw Stock Exchange. Poland completes the largest European IPO in the year.

Downward profit revisions and loss outlooks at several companies dragged Japan indexes lower. Bridgestone estimated annual loss on plant closure costs. Acom Co estimated a full year loss on headcount reductions. Mitsumi Electric cuts its profit outlook by 20%.

Government controlled companies surged in Mumbai trading after finance minister indicated stakes sale to fund social programs. Rupee edged higher as international investors commit more capital to stock market. ITI soars on a speculation of a joint venture with Intel.

The Reserve Bank of Australia revised its annual outlook for the current year and 2010. The central bank lifted its 2009 economic growth to 1.75% from 0.5% and 2010 estimate to 3.5% from 2.25%. Banks led the gainers with the ASX index up 1.9%.

North American Markets

Dow Jones Industrial Average increased 17.46 or 0.2% to a close of 10,023.42, S&P 500 Index added 2.67 or 0.3% to 1,069.30, and Nasdaq Composite Index gained 7.12 or 0.4% to close at 2,112.44. Toronto TSX Composite Index increased 69.72 or 0.5% to 11,250.42.

Of the stocks in S&P 500 index, 250 increased, 233 declined and 17 were unchanged.

Sunoco Inc led the decliners in the S&P 500 index with a loss of 10.2% followed by losses in American International Group, Inc of 9.7%, in Dynegy Inc of 5.9%, in Tesoro Corp of 5.1% and in Motorola Inc of 4.5%.

International Game Technology led gainers in the S&P 500 index with a rise of 8.7% followed by gains in Nvidia Corporation of 7.2%, in Starbucks Corp of 7.3% and in MBIA Inc of 6.6%.

South American Markets Indexes

Mexico Bolsa Index increased 133.28 or 0.5% to 29,868.62 and Brazil Bovespa Stock Index declined 349.59 or 0.5% to 64,466.13.

Argentina markets were closed today and Chile Stock Market Select index added 0.4% and Colombia IGBC General Index decreased 0.3% and Peru Lima General Index added 0.2%.

Europe Markets Review

In London FTSE 100 Index closed higher 6.91 or 0.13% to 5,132.55, in Paris CAC 40 Index decreased 7.49 or 0.20% to close at 3,701.24, in Frankfurt DAX index lower 0.96 or 0.02% to close at 5,479.96. In Zurich trading SMI increased 0.75 or 0.01% to close at 6,285.95.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed higher 71.91 or 0.74% to 9,789.35, and Hang Seng index in Hong Kong increased 350.64 or 1.63% to 21,829.72, and CSI 300 index in China higher 18.70 or 0.54% to 3,483.02. ASX 200 index in Australia increased 86.00 or 1.91% to 4,594.00. The FTSE Bursa KL Composite index in Malaysia was higher 6.80 or 0.54% to 1,260.76.

The Kospi Index in South Korea increased 20.22 or 1.30% to close at 1,572.46. SET index in Thailand closed higher 16.72 or 2.45% to 698.63. JSE Index in Indonesia increased 27.89 or 1.18% to 2,395.11. The Sensex Index in India increased 94.38 or 0.59% to 16,158.28.

Commodities, Metals, and Currencies

Crude oil decreased $2.00 to $77.62 a barrel for a front month contract, natural gas edged down 18 cents to $4.61 per mBtu and gasoline decreased 5.97 cents to 192.80 cents.

Soybean future closed down 17.00 cents to $9.55 a bushel. Wheat futures closed down 15 cents in Chicago trading to $4.97 a bushel. Sugar closed lower 33 cents 22.43 cents.

Gold increased $6.20 in New York trading to close at $1,095.50 per ounce, silver closed down $0.03 to $17.38 per ounce and copper for the front month delivery decreased 0.30 cent to $2.95 per pound.

Dollar edged higher against euro to $1.4849 and edged lower against the Japanese yen to 89.89.

Yield on 10-year U.S. bonds decreased to 3.50% and with 30-year maturities closed unchanged at 4.40%.