Record U.S. Mortgage Defaults; Stocks Sideways

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

U.S. mortgage delinquencies in the fourth quarter declined barely to 9.47% as the new defaults slowed. Consumer prices increased at less than estimated rates in January. Schlumberger is close to finalizing agreement to acquire Smith International.

[R]4:00 PM New York, 9:00 PM London, 8:00 AM Sydney – U.S. mortgage delinquencies in the fourth quarter declined barely to 9.47% as the new defaults slowed. Consumer prices increased at less than estimated rates in January. Schlumberger is close to finalizing agreement to acquire Smith International.[/R]

U.S. stocks in a directionless trading edged up after the Fed raised discount rate and increased the spread between fed funds rate. Consumer price index increased 0.1% in January, less than expected.

Mortgage delinquencies in the fourth quarter to December hovered near the rate in the third quarter even though the new entrants to the loan defaults declined. In the quarter, seasonally adjusted mortgages that late at least 30 days fell to 9.47% from 9.64% in the third quarter according to the latest data from the Mortgage Bankers Association.

In the quarter, loans in foreclosures increased to 4.58% and those that are at least 90 days or more increased to 5.09%.

Apollo Group declined as much as 10% after it forecasted lower than expected second quarter earnings. Dell Inc dropped 7% after quarterly net declined 5%.

Canadian Solar Inc and First Solar Inc declined on lower quarterly margins. J.C. Penney rallied 6% after it reported better than expected earnings. Intuit soared 9% on higher than expected earnings. Smith International surged on buyout talks.

European markets closed higher for the fifth day in a row. Thales declined after it lowered its dividend. Carrefour SA fell after net dropped 74% on higher charges related to store closures. Lafarge declined after full year net dropped 54%.

UK stocks recovered and closed higher but the pound traded at nine-month low. Retail sales in January declined 1.8%. Millennium & Copthorne Hotels plc declares second interim dividend. Rentokil Initial plc fiscal 2009 profit up. BlueBay Asset Management plc profit rises.

Japan market indexes fell more than 1.7% after the U.S. Fed raised rates for emergency lending and began to unwind measures taken during the financial crisis. Geo political risk was also a concern after North Korea was reported to declare a portion of its border as a firing zone. Real estate stocks declined.

Stocks in Mumbai trading declined as investors gauge the demand for the Rural Electrification Corporation secondary offering. Government borrowing in the fiscal 2011 year is expected to exceed $97 billion in the current year.

Fortescue Metals profit falls 94% in the first half. National Australia Bank first quarter earnings increase 20%. Billabong International first half profit decreases 15% on lower sales in North America and weak currency translations.

North American Markets

Dow Jones Industrial Average added 9.45 or 0.09% to a close of 10,402.35, S&P 500 Index edged higher 2.42 or 0.2% to 1,109.17, and Nasdaq Composite Index added 2.16 or 0.1% to close at 2,243.87. Toronto TSX Composite Index increased 8.93 or 0.08% to 11,703.79.

Latin American Markets Indexes

Mexico Bolsa Index increased 1.32 to 32,170.79 and Brazil Bovespa Stock Index fell 238.65 or 0.4% to 67,597.43.

Europe Markets Review

In London FTSE 100 Index closed higher 33.08 or 0.62% to 5,358.17, in Paris CAC 40 Index increased 21.75 or 0.58% to close at 3,769.54, in Frankfurt DAX index higher 41.64 or 0.73% to close at 5,722.05. In Zurich trading SMI increased 72.39 or 1.09% to close at 6,709.68.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 212.11 or 2.05% to 10,123.58, Hang Seng index in Hong Kong decreased 528.13 or 2.59% to 19,894.02. ASX 200 index in Australia decreased 19.66 or 0.42% to 4,635.10. The FTSE Bursa KL Composite index in Malaysia closed lower 1.33 or 0.11% to 1,257.67. The Markets of China were closed today.

The Kospi Index in South Korea decreased 27.29 or 1.68% to close at 1,593.90. SET index in Thailand closed higher 4.78 or 0.69% to 700.44 and JSE Index in Indonesia decreased 5.66 or 0.22% to 2,554.38. The Sensex index in India decreased 136.21 or 0.83% to 16,191.63.

Commodities, Metals, and Currencies

Crude oil increased $0.74 to $79.80 a barrel for a front month contract, natural gas edged down 13 cents to $5.04 per mBtu and gasoline increased 2.08 cents to 209.00 cents.

Soybean future closed down 3.00 cents to $9.54 a bushel. Wheat futures closed up 4.50 cents in Chicago trading to $5.04 a bushel. Sugar closed up 0.16 cents at 25.96 cents per pound.

Gold increased $1.60 in New York trading to close at $1,120.30 per ounce, silver closed up $0.25 to $16.30 per ounce and copper for the front month delivery increased 6.40 cent to $3.36 per pound.

Dollar edged up against euro to $1.3599 and edged higher against the Japanese yen to 91.64.

Yield on 10-year U.S. bonds closed down to 3.78% and with 30-year maturities closed lower at 4.71%.