U.S. Stocks, Commodities Fall; Dubai Hangover

123jump.com Staff
08 Dec, 2009
New York City

U.S. stocks, gold and crude oil declined as banks in Europe edged lower and industrial and financials declined in New York. Dubai worries dragged banks in London. Gold and crude oil fell after the dollar maintained its advance against currencies.

[R]4:30 PM New York, 9:30 PM London, 8:30 AM Sydney – U.S. stocks, gold and crude oil declined as banks in Europe edged lower and industrial and financials declined in New York. Dubai worries dragged banks in London. Gold and crude oil fell after the dollar maintained its advance against currencies.[/R]

U.S. stocks and gold declined as the dollar edged higher. European and the Middle East markets fell. Banks in Europe and UK traded lower. Dubai and Saudi Markets dropped for the sixth day as investor fear rising losses at Dubai World and acrimonious discussion with bondholders.

Dubai World debt negotiations may be acrimonious as bond holders demand control of assets and threaten legal action in Europe and the U.S. The sukuk issued by Nakheel dropped in London trading as investors fear mounting losses may erode asset values.

Greek stocks and bonds decline as rating agencies clamor for a possible downgrade and investors fear deteriorating government financials. Though investors demand higher yield on bonds, Greece is not alone when it comes lack of fiscal discipline in Europe.

Dubai worries dominated trading in London. The UK benchmark index declined after commodities and banks closed lower. Royal Bank of Scotland and Standard Chartered led the decliners in the sector. Tesco same store sales increased 2.8% in the third quarter.

German seasonally adjusted industrial production decreased 1.8% in October from September. Production declined 12.4% from a year ago. BMW and Volkswagen sales increased in November. Greek stocks and bonds decline.

Japan plans to unveil 7.2 trillion yen or $81 billion additional stimulus that will offer a mix tax rebate, increased loans to small businesses and support to the struggling job market. Bankruptcies fall 11.4% in November in Japan. Current account surplus in October increased 43%.

The Indian government plans to increase its spending by $5 billion to support food, fertilizer and energy prices. Auto sales in November surged 61% as small cars drive sales. Bus, truck and motor cycle sales also gained. JSW Energy initial public offering was oversubscribed on the second day.

Australia’s current account deficit soars 23% to A$16.2 billion in September and business confidence rises in November. Stocks decline after crude oil and gold prices edge lower.

North American Markets

Dow Jones Industrial Average decreased 104.14 or 1% to a close of 10,285.97, S&P 500 Index edged lower 11.31 or 1% to 1,091.94, and Nasdaq Composite Index decreased 16.62 or 0.8% to close at 2,172.99. Toronto TSX Composite Index decreased 120.70 or
1.1% to 11,368.63.

Of the stocks in S&P 500 index, 92 increased, 400 declined and 8 were unchanged.

The Kroger Co led the decliners in the S&P 500 index with a loss of 11.9% followed by losses in Supervalu Inc of 8.7%, in Safeway Inc of 6.8%, in Sprint Nextel Co of 6.6% and in Nvidia Corp of 4.8%.

Gannett Co., Inc led gainers in the S&P 500 index with a rise of 6.4% followed by gains in Motorola, Inc 6%, in Interpublic Group of 5.4%, in M&T Bank Corp of 3.8% and in Ball Corp of 3.7%.

South American Markets Indexes

Mexico Bolsa Index decreased 374.78 or 1.2% to 31,710.39 and Brazil Bovespa Stock Index decreased 783.68 or 1.2% to 67,728.51.

Europe Markets Review

In London FTSE 100 Index closed lower 87.53 or 1.65% to 5,223.13, in Paris CAC 40 Index decreased 54.75 or 1.43% to close at 3,785.30, in Frankfurt DAX index lower 96.17 or 1.66% to close at 5,688.58. In Zurich trading SMI decreased 70.87 or 1.10% to close at 6,399.74.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 27.13 or 0.27% to 10,140.47, and Hang Seng index in Hong Kong decreased 264.44 or 1.18% to 22,060.52, and CSI 300 index in China lower 44.81 or 1.22% to 3,624.02. ASX 200 index in Australia decreased 5.90 or 0.13% to 4,670.60. The FTSE Bursa KL Composite index in Malaysia was lower 3.90 or 0.31% to 1,261.46.

The Kospi Index in South Korea decreased 4.87 or 0.30% to close at 1,627.78. SET index in Thailand closed lower 2.76 or 0.39% to 698.82. JSE Index in Indonesia increased 0.13 or 0.01% to 2,483.89. The Sensex index in India increased 244.54 or 1.44% to 17,227.68.

Commodities, Metals, and Currencies

Crude oil decreased $1.31 to $72.62 a barrel for a front month contract, natural gas edged increased 14 cents to $5.11 per mBtu and gasoline decreased 1.86 cents to 192.20 cents.

Soybean future closed down 9.00 cents to $10.44 a bushel. Wheat futures closed down 8.25 cents in Chicago trading to $5.39 a bushel. Sugar closed lower 0.23 cent 22.20 cents.

Gold decreased $33.70 in New York trading to close at $1,130.30 per ounce, silver closed down $0.75 to $17.62 per ounce and copper for the front month delivery decreased 5.40 cent to $3.15 per pound.

Dollar closed higher against euro to $1.4707 and edged lower against the Japanese yen to 88.38.

Yield on 10-year U.S. bonds decreased to 3.39% and with 30-year maturities closed unchanged at 4.38%.