Crude Oil, Metals Drop; U.S. Stocks Rebound

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

Crude oil closed lower today and has now fallen more than 12% in the last fifteen days. Gold and U.S. Treasuries edged lower. U.S. stocks closed higher despite worries that emerging markets may suffer another debt downgrade.

[R]4:30 PM New York, 9:30 PM London, 8:30 AM Sydney – Crude oil closed lower today and has now fallen more than 12% in the last fifteen days. Gold and U.S. Treasuries edged lower. U.S. stocks closed higher despite worries that emerging markets may suffer another debt downgrade.[/R]

U.S. stocks closed higher at close despite growing worries that the emerging market may face debt downgrade. The Dubai contagion is likely to spread to Greece, Spain, Ireland and other emerging markets. S&P lowered Spain sovereign debt rating by one notch.

Dr Pepper Snapple will receive one time payment of $900 million to license certain brands to PepsiCo. Movado Group plunged after it reported sharply lower quarterly earnings. Kroger and Men’s Wearhouse plunge more than 10% weak results.

Volkswagen AG and Suzuki Motor acquire stakes in each other as the German auto maker looks for growth in small car segment in India. VW will pay $2.5 billion for nearly 20% stake in Suzuki. Only a decade ago VW had questioned the need to be in India and relied on China and Brazil of sales increase.

The weakness in banks dragged European markets lower at close. Investors fear that debt downgrades at Spain, Europe and emerging nations may generate more losses at banks. VW and Suzuki finalized their cross-investment and joint collaboration.

UK plans to tax banker bonuses with 50% levy and will also increase national insurance contributions to pay for the bank bailout and economic stimulus. BHP Billiton sells Ravensthorpe for $340 million.

Stocks in India traded lower but software services providers reached a new annual high. Standard Chartered Bank offered $1 billion of credit line to Essar Oil to fund its refinery purchase Europe. Godrej Properties initial offering is oversubscribed on the first day.

North American Markets

Dow Jones Industrial Average increased 51.08 or 0.5% to a close of 10,337.05, S&P 500 Index edged higher 4.01 or 0.4% to 1,095.95, and Nasdaq Composite Index increased 10.74 or 0.5% to close at 2,183.73. Toronto TSX Composite Index increased 10.29 or
0.1% to 11,379.22.

Of the stocks in S&P 500 index, 283 increased, 205 declined and 12 were unchanged.

Frontier Communication led the decliners in the S&P 500 index with a loss of 3.7% followed by losses in Debrury Resource of 3.2% and in Legg Mason Inc of 3.2%, in Autodesk Inc of 3.1% and in CBS Corp of 3%.

AK Steel Holding led gainers in the S&P 500 index with a rise of 6.2% followed by gains in U.S. Steel Corp 5.7%, in Sprint Nextel Corp of 5.6% and in Devry Inc of 5.4%.

South American Markets Indexes

Mexico Bolsa Index decreased 40.18 or 0.1% to 31,670.21 and Brazil Bovespa Stock Index increased 283.48 or 0.4% to 68,011.99.

Argentina Merval Index decreased 0.5% and Chile Stock Market Select index fell 0.2% and Colombia IGBC General Index decreased 0.2% and in Peru Lima General Index decreased 0.3%.

Europe Markets Review

In London FTSE 100 Index closed lower 19.24 or 0.37% to 5,203.89, in Paris CAC 40 Index decreased 27.91 or 0.74% to close at 3,757.39, in Frankfurt DAX index lower 40.74 or 0.72% to close at 5,647.84. In Zurich trading SMI decreased 48.03 or 0.75% to close at 6,351.71.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 135.75 or 1.34% to 10,004.72, and Hang Seng index in Hong Kong decreased 318.76 or 1.44% to 21,741.76, and CSI 300 index in China lower 69.54 or 1.92% to 3,554.48. ASX 200 index in Australia decreased 32.70 or 0.70% to 4,637.90. The FTSE Bursa KL Composite index in Malaysia was lower 5.70 or 0.45% to 1,255.76.

The Kospi Index in South Korea increased 6.39 or 0.39% to close at 1,634.17. SET index in Thailand closed lower 4.11 or 0.59% to 694.71. JSE Index in Indonesia decreased 2.59 or 0.10% to 2,481.30. The Sensex index in India decreased 102.46 or 0.59% to 17,125.22.

Commodities, Metals, and Currencies

Crude oil decreased $1.95 to $70.67 a barrel for a front month contract, natural gas edged down 21 cents to $4.898 per mBtu and gasoline decreased 6.73 cents to 185.73 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 $13.90 in New York trading to close at $1,129.50 per ounce, silver closed down $0.63 to $17.18 per ounce and copper for the front month delivery decreased 4.15 cent to $3.12 per pound.

Dollar closed lower against euro to $1.4737 and edged lower against the Japanese yen to 87.98.

Yield on 10-year U.S. bonds increased to 3.43% and with 30-year maturities closed up at 4.42%.