U.S. Extends World Rally; Treasury Auction

Mukesh Buch
09 Nov, 2009
New York City

U.S market indexes gained 2% after commodities gained and investor bid up industrial and technology stocks. The statement from G-20 nation reassured markets that stimulus will stay in place. U.S. Treasury starts weekly bond auction for $81 billion. Sprint Nextel surges 20%.

[R]4:30 PM New York, 9:30 PM London, 8:30 AM Sydney – U.S market indexes gained 2% after commodities gained and investor bid up industrial and technology stocks. The statement from G-20 nation reassured markets that stimulus will stay in place. U.S. Treasury starts weekly bond auction for $81 billion. Sprint Nextel surges 20% after it estimated positive outlook.[/R]

World markets advance after G-20 left stimulus in place after a meeting. The group of wealthy and developing nations focused on the strategies to revive growth. The dollar fell after the statement and copper and gold advanced.

U.S. stocks climbed on the positive trading sentiment generated by the G-20 statement. Industrials, retail and technology related stocks led the gainers.

Las Vegas Sands advanced after it arranged bank commitment of $1.45 billion for Macau casino. Wynn Resorts gained on $4 special dividend. East West Bank surged 51%. Sprint Nextel surged 20% after it plans to cut at least 2,000 staff to save $350 million and it anticipates to generate positive cash flow in the fourth quarter.

U.S. Treasury began its $81 billion of bond offering with maturities ranging from 3 years to 30 years.

European markets closed higher after G-20 meeting. Investors bid up stocks and commodities in Europe on the expectations that the current stimulus will remain in place. Allianz reported sharply higher earnings as markers rebound.

UK stocks rallied after markets around the world and commodities prices gained. The statement from the G-20 nations reassured investors that the current economic stimulus will stay in place. Cadbury Plc rejected unsolicited Kraft Foods bid that valued the company at £9.8 billon.

Prime Minister Singh of India suggested that Indian economy is recovering and likely to meet the economic target of 6.5% in the current year and 7% in fiscal 2010. Stocks surged. T. Rowe Price acquired 26% stake in UTI Asset Management as retail investments surge fivefold in five years.

North American Markets

Dow Jones Industrial Average increased 203.52 or 2.1% to a close of 10,226.94, S&P 500 Index added 23.78 or 2.2% to 1,093.08, and Nasdaq Composite Index gained 41.62 or 2% to close at 2,154.06. Toronto TSX Composite Index increased 236.46 or 2.1% to 11,486.88.

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

Lexmark International, Inc led the decliners in the S&P 500 index with a loss of 4.5% followed by losses in DeVry Inc of 3.5%, in Windstream Corporation of 2.1%, in Sunoco Inc f 2.1% and in Red Hat Inc of 1.2%.

Sprint Nextel led gainers in the S&P 500 index with a surge of 20.4% followed by gains in Radio Shack Corp 14.2%, in MBIA Inc of 10.4% and in Prologis of 8.4%.

South American Markets Indexes

Mexico Bolsa Index increased 777.62 or 2.6% to 30,646.24 and Brazil Bovespa Stock Index increased 1,748.22 or 2.7% to 66,214.35.

Argentina Merval Index increased 3% and Chile Stock Market Select index added 1.2% and Colombia IGBC General Index increased 1.6% and Peru Lima General Index added 1%.

Europe Markets Review

In London FTSE 100 Index closed higher 95.09 or 1.85% to 5,237.81, in Paris CAC 40 Index increased 71.78 or 1.94% to close at 3,779.07, in Frankfurt DAX index higher 116.78 or 2.13% to close at 5,605.03. In Zurich trading SMI increased 87.41 or 1.39% to close at 6,381.02.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed higher 19.64 or 0.20% to 9,808.99, and Hang Seng index in Hong Kong increased 377.83 or 1.73% to 22,207.55, and CSI 300 index in China higher 12.77 or 0.37% to 3,495.79. ASX 200 index in Australia increased 80.90 or 1.76% to 4,674.90. The FTSE Bursa KL Composite index in Malaysia was higher 6.99 or 0.55% to 1,267.75.

The Kospi Index in South Korea increased 4.33 or 0.28% to close at 1,576.79. SET index in Thailand closed higher 14.85 or 2.13% to 713.48. JSE Index in Indonesia increased 11.33 or 0.47% to 2,406.43. The Sensex Index in India increased 340.44 or 2.11% to 16,498.72.

Commodities, Metals, and Currencies

Crude oil decreased $0.14 to $79.29 a barrel for a front month contract, natural gas edged down 2 cents to $4.65 per mBtu and gasoline increased 5.75 cents to 198.18 cents.

Soybean future closed up 17.00 cents to $9.72 a bushel. Wheat futures closed up 22.75 cents in Chicago trading to $5.20 a bushel. Sugar closed lower 2 cents 22.41 cents.

Gold increased $3.00 in New York trading to close at $1,104.40 per ounce, silver closed up $0.19 to $17.56 per ounce and copper for the front month delivery increased 1.75 cent to $2.97 per pound.

Dollar edged lower against euro to $1.5003 and edged lower against the Japanese yen to 89.91.

Yield on 10-year U.S. bonds decreased to 3.49% and with 30-year maturities closed unchanged at 4.40%.