U.S. Indexes Close Higher on Bernanke Stance

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

Stocks bounced around but closed higher after Fed Chairman Bernanke said rates are likely to remain for a long time. New Home sales in January plunged to the lowest since record keeping began in 1963 and declined 6.5% from a year ago. Akio Toyoda aplogized to U.S. lawmakers for quality problems.

[R]4:00 PM New York, 9:00 PM London, 8:00 AM Sydney – Stocks bounced around but closed higher after Fed Chairman Bernanke said rates are likely to remain for a long time. New Home sales in January plunged to the lowest since record keeping began in 1963. Japan exports surge. Hong Kong economy rebounds in last quarter. Indian Railways increase spending.[/R]

New Home sales declined 11% in January and median home price declined to $203,500 the lowest in seven years. Annual pace of new home sales in January of 309,000 was the lowest since record keeping began in 1963, according to the U.S. Commerce Department.

The decline of new home sales of 6.5% from a year ago in January highlighted difficult climate for borrowing and huge overhang of existing homes inventory.

Fed Chairman Bernanke reiterated in his prepared remarks to lawmakers that interest rates will remain low for extended period. Stocks edge up.

H&R Block, Inc plunged 15% after the company said it will not meet its 2010 estimates. Bowne & Co. soared 60% after it agreed to be acquired by Donnelley & Sons Co. Dolan Media Co sees revenue above estimates. Eaton Vance profit jumps 87%.

European markets closed higher on stronger than expected earnings from Rhodia, Fresenius and Vallourec. Industrial new orders in December increased, surprising most economists. French jobless rolls increased to 2.66 million.

UK indexes closed higher. Royal Bank of Scotland plans to award £1.03 billion in 2009 bonus to employees. Carnival gained after cruise bookings are ahead of management expectations. BlueBay Asset Management reported first half net more than quadrupled.

Japan exports in January surged 40.9% and recorded a trade surplus of 85.2 billion yen defying the expectations of deficit. Exports to Asia increased 68%. Showa Shell Sekiyu K.K led the decliners in the Nikkei 225 Stock Average with a loss of 9.8%.

Hong Kong fourth quarter GDP increased 2.3% and for 2009 shrank 2.7% on 12.6% decline in exports. Hong Kong increased stamp duty on luxury homes. Cathay Pacific and Air China negotiate air cargo venture.

Indian Railways proposed a capital spending to increase 2.7% in the next fiscal year. Freight handled is expected to increased 6% and passenger revenues to increase 7%. The railways proposed to pay dividend of $1.2 billion to the central government.

Australian benchmark index declined on weak commodities prices. The Australian dollar gained 0.2%. Total construction work hours increased 2.6% in the three months to December. Suncorp-Metway dropped after it trimmed dividend. Woodside 2009 profit increased 2.1%.

North American Markets

Dow Jones Industrial Average increased 91.75 or 0.9% to a close of 10,374.16, S&P 500 Index edged higher 10.64 or 1% to 1,105.24, and Nasdaq Composite Index increased 22.46 or 1.01% to close at 2,235.90. Toronto TSX Composite Index decreased 6.68 or 0.06% to 11,520.03.

Latin American Markets Indexes

Mexico Bolsa Index decreased 61.70 to 31,788.54 and Brazil Bovespa Stock Index fell 289.23 or 0.5% to 65,819.10.

Europe Markets Review

In London FTSE 100 Index closed higher 27.83 or 0.52% to 5,342.92, in Paris CAC 40 Index increased 8.62 or 0.23% to close at 3,715.68, in Frankfurt DAX index higher 11.44 or 0.20% to close at 5,615.51. In Zurich trading SMI increased 38.86 or 0.58% to close at 6,687.95.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 153.27 or 1.48% to 10,198.83, and Hang Seng index in Hong Kong decreased 155.26 or 0.75% to 20,467.74, and CSI 300 index in China higher 45.85 or 1.43% to 3,244.48. ASX 200 index in Australia decreased 69.80 or 1.48% to 4,648.50. The FTSE Bursa KL Composite index in Malaysia was higher 4.35 or 0.34% to 1,270.78.

The Kospi Index in South Korea decreased 16.07 or 0.99% to close at 1,612.83. SET index in Thailand closed higher 0.40 or 0.06% to 715.18. JSE Index in Indonesia decreased 4.23 or 0.16% to 2,579.42. The Sensex index in India decreased 30.35 or 0.19% to 16,255.97.

Commodities, Metals, and Currencies

Crude oil increased $1.21 to $80.07 a barrel for a front month contract, natural gas edged up 4 cents to $4.82 per mBtu and gasoline increased 3.19 cents to 209.75 cents.

Soybean future closed up 3.50 cents to $9.63 a bushel. Wheat futures increased 8.00 cents in Chicago trading to $5.13 a bushel. Sugar closed up 0.72 cents at 24.40 cents per pound.

Gold decreased $6.40 in New York trading to close at $1,096.80 per ounce, silver closed up $0.12 to $15.93 per ounce and copper for the front month delivery increased 0.80 cent to $3.24 per pound.

Dollar edged lower against euro to $1.3536 and declined against the Japanese yen to 90.18.

Yield on 10-year U.S. bonds closed down to 3.68% and with 30-year maturities closed lower at 4.62%.