Deals Drive World Markets; U.S. Stocks Struggle

123jump.com Staff
08 Mar, 2010
New York City

U.S. stocks struggled at close. MetLife agreed to acquire life insurance division of AIG for $15.5 billion. Royal Dutch Shell and PetroChina bid for Arrow Energy in Australia. Oil stays firm and the dollar inches lower. LyondellBasel prefers its restructuring to the offer from Reliance Industries.

[R]4:00 PM New York, 9:00 PM London, 8:00 AM Sydney – U.S. stocks struggled at close. MetLife agreed to acquire life insurance division of AIG for $15.5 billion. Royal Dutch Shell and PetroChina bid for Arrow Energy in Australia. Oil stays firm and the dollar inches lower.[/R]

U.S. stocks are traded higher on a global optimism and a rise in Asian and European markets but failed to hang onto their gains. AIG completed the delayed agreement of $15.5 billion to sell its life insurance division to MetLife. The dollar edged down after fears of Greece default recede and Dubai prepares its restructuring plan.

Dubai is expected to offer restructuring plan for $26 billion and may disappoint bankers by not offering state guarantee. French President offered more support for Greece and Prime Minister Papandreou is scheduled to meet Barack Obama tomorrow.

American International Group surged 3% and MetLife gained 5% after they agreed on a deal of $15.5 billion. Hewlett Packard lowered its earnings estimate by 3 cents a share. Xyartex Ltd soared 15% after it revised higher earnings estimate. Imax Corp surged on record weekly box office revenues.

European market indexes closed nearly unchanged after the early gains evaporated. Resource sector stocks trade higher. French President voiced a strong support to Greece to send a signal to investors and support the euro. Air France-KLM traffic declined 2.2% in February.

The UK stock index closed higher after fractional gains in commodities. Petrofac, the oil services provider said 2009 net income surged 33%. Scotland port operator Forth Ports surged 26% on two buyout offers. Royal Dutch Shell and PetroChina offer to acquire Australia based Arrow Energy Ltd.

Japan January exports surged 41% and imports increased 7% as exports to the U.S., EU and China rebound for the second month in a row. Current account swings to a surplus from a year ago month. JFE Holdings agreed to a 55% increase in price in a quarterly contract, a departure from a yearly price negotiation.

Banks in India surged after finance minister Mukherjee sought Parliament approval to permit banks to sell more shares. Rupee edged higher. Essar Group agreed to acquire Trinity Coal Corp for $600 million and is said to prepare securities offering in London for as much as $3 billion.

North American Markets

Dow Jones Industrial Average decreased 13.68 or 0.1% to close at 10,552.52, S&P 500 Index edged lower 0.20 or 0.02% to 1,138.50 and Nasdaq Composite Index added 5.86 or 0.25% to close at 2,332.21. Toronto TSX Composite Index decreased 11.30 or 0.09% to 11,963.84.

Latin American Markets Indexes

Mexico Bolsa Index increased 83.74 or 0.2% to 32,520.27 and Brazil Bovespa Stock Index decreased 271.03 or 0.4% to 68,575.47.

Europe Markets Review

In London FTSE 100 Index closed higher 6.96 or 0.12% to 5,606.72, in Paris CAC 40 Index decreased 6.88 or 0.18% to close at 3,903.54, in Frankfurt DAX index lower 1.45 or 0.02% to close at 5,875.91. In Zurich trading SMI increased 3.42 or 0.05% to close at 6,851.20.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed higher 216.96 or 2.09% to 10,585.92, and Hang Seng index in Hong Kong increased 408.90 or 1.97% to 21,196.87, and CSI 300 index in China higher 26.41 or 0.81% to 3,286.18. ASX 200 index in Australia increased 40.70 or 0.85% to 4,807.90. The FTSE Bursa KL Composite index in Malaysia was higher 24.44 or 1.88% to 1,324.22.

The Kospi Index in South Korea increased 25.47 or 1.56% to close at 1,660.04. SET index in Thailand closed lower 3.67 or 0.51% to 720.29. JSE Index in Indonesia increased 47.68 or 1.85% to 2,626.45. The Sensex index in India increased 108.11 or 0.64% to 17,102.60.

Commodities, Metals, and Currencies

Crude oil increased $0.25 to $81.75 a barrel for a front month contract, natural gas edged down 3 cents to $4.57 per mBtu and gasoline increased 0.70 cents to 227.80 cents.

Soybean future closed up 5.25 cents to $9.48 a bushel. Wheat futures increased 1.50 cents in Chicago trading to $4.95 a bushel. Sugar closed down 0.62 cents at 21.57 cents per pound.

Gold decreased $13.10 in New York trading to close at $1,122.10 per ounce, silver closed down $0.14 to $17.24 per ounce and copper for the front month delivery decreased 0.25 cent to $3.41 per pound.

Dollar edged lower against euro to $1.3633 and gained against the Japanese yen to 90.29.

Yield on 10-year U.S. bonds closed up to 3.72% and with 30-year maturities closed lower at 4.68%.