Home Sales Drive Stocks Higher, Bonds Fall

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

Stocks closed higher after the November existing home sales increased at the fastest pace since February 2007. First time home buyers were 51% of sales and distressed or foreclosure sales 33% of total. Gold and other metals decreased.

[R]4:30 PM New York, 9:30 PM London, 8:30 AM Sydney – Stocks closed higher after the November existing home sales increased at the fastest pace since February 2007. First time home buyers were 51% of sales and distressed or foreclosure sales 33% of total. Gold and other metals decreased.[/R]

U.S. stocks futures closed higher after the third GDP estimate for the third quarter was revised lower and existing home sales in November at the fastest pace in nearly three years.

Sales were up 44% from a year ago and 51% of buyers were first time buyers. The annual rate of 6.54 million home sales was an increase of 7.4% from October. Foreclosure or distressed properties sales were 33% of total sales in the month.

Airlines traded higher on the expectations of strong holiday season. Jabil Circuit, Inc swings to fiscal first quarter profit and led the gainers in the outsourcing sector. Navistar International Corp fourth quarter sales declined 15%. Commercial Metals Co swings to first quarter loss. China related travel companies declined.

UK GDP decline in the third quarter was revised to 0.2% from the previous estimate of 0.3% and third quarter unemployment rate increased to 7.8%. Hardy Oil and Gas Plc in partnership with Reliance in India discovered third natural gas field in the Bay of Bengal offshore field.

European markets edged higher on the prospects of improved earnings in 2011 and speedier global markets recovery. A.P. Moeller Maersk agreed to pay $1.3 billion to acquire energy fields in the Gulf of Mexico. Areva T&D division received €200 million contract from a Dubai utility.

Stocks in Japan closed higher after the yen weakened. Semiconductor equipment makers and exporters led the gainers in Tokyo trading. Honda sales in China and Asia set a new record. Isuzu is exploring new diesel engine development with General Motors.

Mumbai stocks increased after resource and telecom stocks advanced. Reliance Industries discovered third gas field in Bay of Bengal field that may be as large as the first field of 10 trillion cubic feet. State controlled oil companies will get cash subsidies rather than bonds from the central government.

Stocks in Australia edged higher after world markets edged up. Commodities prices edged lower. BHP Billiton after the close agreed to sell its nickel mining holdings to its joint venture partner in Philippines. GrainCorp Ltd declined after the company said profits are likely to be lower than estimated. Gold stocks fell on a rebound in the U.S. dollar.

North American Markets

Dow Jones Industrial Average increased 50.79 or 0.5% to a close of 10,464.93, S&P 500 Index edged higher 3.97 or 0.4% to 1,118.02, and Nasdaq Composite Index increased 15.01 or 0.7% to close at 2,252.67. Toronto TSX Composite Index added 73.26 or 0.6% to 11,627.98.

Latin American Markets Indexes

Mexico Bolsa Index increased 441.09 or 1.4% to 32,240.32 and Brazil Bovespa Stock Index added 1,492.74 or 2.3% to 67,417.93.

Europe Markets Review

In London FTSE 100 Index closed higher 34.67 or 0.65% to 5,328.66, in Paris CAC 40 Index increased 26.32 or 0.68% to close at 3,898.38, in Frankfurt DAX index higher 15.16 or 0.26% to close at 5,945.69. In Zurich trading SMI increased 78.46 or 1.21% to close at 6,582.90.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed higher 194.56 or 1.91% to 10,378.03, and Hang Seng index in Hong Kong increased 143.94 or 0.69% to 21,092.04, and CSI 300 index in China lower 91.08 or 2.68% to 3,305.54. ASX 200 index in Australia increased 69.10 or 1.49% to 4,704.20. The FTSE Bursa KL Composite index in Malaysia was higher 4.76 or 0.38% to 1,260.42.

The Kospi Index in South Korea increased 11.31 or 0.69% to close at 1,655.54. SET index in Thailand closed higher 9.23 or 1.29% to 724.40. JSE Index in Indonesia increased 36.25 or 1.49% to 2,467.64. The Sensex Index in India increased 90.80 or 0.55% to 16,692.00.

Commodities, Metals, and Currencies

Crude oil increased $0.40 to $74.12 a barrel for a front month contract, natural gas edged up 7 cents to $5.74 per mBtu and gasoline increased 1.83 cents to 188.74 cents.

Soybean future closed down 10.00 cents to $9.98 a bushel. Wheat futures closed up 3.50 cents in Chicago trading to $5.23 a bushel. Sugar closed higher 0.88 cent 26.50 cents.

Gold decreased $12.00 in New York trading to close at $1,084.00 per ounce, silver closed down $0.05 to $16.98 per ounce and copper for the front month delivery decreased 2.00 cent to $3.13 per pound.

Dollar closed higher against euro to $1.425 and edged higher against the Japanese yen to 91.83.

Yield on 10-year U.S. bonds increased to 3.75% and with 30-year maturities closed higher at 4.61%.