U.S. Indexes Advance 1%; Dollar Firm

123jump.com Staff
09 Feb, 2010
New York City

U.S. stocks advanced after a sell-off that has lasted four weeks. Broader market indexes increased more than 1% in the early trading. Commodities advanced on the back of the stronger dollar. U.S. Treasury to sell $40 billion of 5-year bonds today.

[R]10:00 AM New York – U.S. stocks advanced after a sell-off that has lasted four weeks. Broader market indexes increased more than 1% in the early trading. Commodities advanced on the back of the stronger dollar. U.S. Treasury to sell $40 billion of 5-year bonds today.[/R]

Currency and stock markets in Europe are building expectations of a bailout engineered by the European Central Bank for Greece. Early departure of the President Jean Claude Trichet fueled speculation that a bailout package for Greece is imminent.

The euro edged higher in the early trading in Frankfurt but later lost the gains after the opening of market in New York. The prospect of wider contagion that may spread to Spain and Portugal and may even engulf Italy is worrying investors.

European Union leaders are scheduled to meet February 11 to discuss financial alternatives for Greece and the timing of the withdrawal of various stimulus measures in place.

Yield on Treasuries increased ahead of $40 billion of 5-year bond offering today and $81 billion bonds and notes this week.

Yield on 10-year bonds increased to 3.6% and 30-year bonds traded at 4.53%.

Commodities markets have been on the rise on the strength in the dollar.

Futures of metals and energy traded higher. Gold prices increased by $7.80 to $1,074 and crude oil increased 64 cents to $72.53.

Earnings Review

Electronic Arts Inc, the video game publisher said third quarter revenues fell 25% to $1.24 billion from $1.65 billion a year ago. Net loss in the quarter was $82 million or 25 cents per diluted share compared to net loss of $641 million or $2.00 per share a year ago.

Principal Financial Group, Inc, an insurance, retirement and financial services company said fourth quarter revenues fell 2% to $2.23 billion from $2.28 billion a year ago. Net income in the quarter was $141.9 million or 44 cents per diluted share compared to net loss of $7.5 million or 3 cents per share a year ago.

Stocks in Focus

Coca-Cola Company ((KO)) advanced 3% after it reported fourth quarter earnings of 66 cents a share on rising distribution volumes in China and India.

Electronic Arts ((ERTS)) declined nearly 8% after it reported a loss and guided lower than expected earnings in 2011.

Harman International Industries Inc ((HAR)) increased more than 7% after it reported adjusted profit of 40 cents a share in the fiscal second quarter.

Lincoln National Corp ((LNC)) increased 2% after it reported fourth quarter sales of $2.40 billion.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 18.92 or 0.19% to 9,932.90, and Hang Seng index in Hong Kong increased 239.39 or 1.22% to 19,790.28, and CSI 300 index in China higher 18.20 or 0.58% to 3,169.19. ASX 200 index in Australia decreased 16.30 or 0.36% to 4,505.10. The FTSE Bursa KL Composite index in Malaysia was lower 1.36 or 0.11% to 1,233.86.

The Kospi Index in South Korea increased 17.70 or 1.14% to close at 1,570.49. SET index in Thailand closed lower 2.20 or 0.32% to 685.89. JSE Index in Indonesia increased 13.91 or 0.56% to 2,489.48. The Sensex index in India increased 106.57 or 0.67% to 16,042.18.

Europe Markets Review

In London FTSE 100 Index traded higher 10.27 or 0.20% to 5,102.60, in Paris CAC 40 Index decreased 14.52 or 0.40% to 3,592.75 and in Frankfurt DAX index traded lower 6.52 or 0.12% to 5,478.33. In Zurich trading SMI decreased 5.80 or 0.09% to 6,341.34.