Fed on Hold; European Markets Rebound

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

U.S. Federal Reserve left its key lending rate range unchanged and cautioned that while labor markets are stabilizing the bank lending is still contracting. The Fed also estimated that rates will be low for an extended period of time.

[R]4:00 PM New York, 9:00 PM London, 8:00 AM Sydney – Federal Reserve left its key lending rate range unchanged and cautioned that while labor markets are stabilizing the bank lending is still contracting. The Fed also estimated that rates will be low for an extended period of time.[/R]

U.S. stocks closed higher after the Federal Reserve left its target range unrevised and said that the rates are likely to be low for an extended period of time. The Fed also noted in its accompanying statement that labor markets are stabilizing but bank lending is still contracting.

Housing starts declined 5.9% in February to annual rate of 575,000 units. Bad weather affected hosing completion to plunge 15.5% from a year ago. Financial Engines, Inc priced its initial public offering to raise $127 million.

Genpact Ltd declined after shareholders plan to sell 28 million shares. Financial Engines Inc surged 39% from its initial public offering price. FactSet Research Systems Inc gained 3% after it reported earnings increased 4.5%. Deutsche Bank swung to a quarterly profit.

European market indexes closed more than 1% after EU finance ministers agreed on framework in supporting Greece and rating agency Standard & Poor’s reaffirmed its sovereign debt rating. Bulgari SpA swung loss and Swiss chocolate maker Lindt guided higher 2010 growth.

UK stocks edged higher after commodities rebounded. British Airways reach a settlement with the union on pension contribution commitment to finalize the purchase of Spain based Iberia. BP Plc takes a majority stake in the oilsands venture in Canada.

The benchmark index in Mumbai trading gained more than 1% as investors focused on earnings in the current quarter and advanced tax payments. Reliance Industries payment of $170 million bolstered market sentiment despite the inflation hovering near 20%. Jet Airways expanded its route network.

North American Markets

Dow Jones Industrial Average increased 43.83 or 0.4% to close at 10,685.98, S&P 500 Index edged lower 8.95 or 0.8% to 1,159.46 and Nasdaq Composite Index fell 15.80 or 0.7% to close at 2,378.01. Toronto TSX Composite Index increased 145.85 or 0.5% to 12,089.40.

Latin American Markets Indexes

Mexico Bolsa Index increased 145.85 or 0.5% to 32,723.90 and today Brazil Bovespa Stock Index gained 918.46 or 1.3% to 69,942.21.

Europe Markets Review

In London FTSE 100 Index closed higher 28.96 or 0.52% to 5,622.81, in Paris CAC 40 Index increased 49.98 or 1.28% to close at 3,940.89, in Frankfurt DAX index higher 64.96 or 1.10% to close at 5,968.52. In Zurich trading SMI increased 51.18 or 0.75% to close at 6,876.28.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 30.27 or 0.28% to 10,721.71, and Hang Seng index in Hong Kong decreased 56.17 or 0.27% to 21,022.93, and CSI 300 index in China higher 20.79 or 0.65% to 3,203.97. ASX 200 index in Australia increased 13.10 or 0.27% to 4,797.20. The FTSE Bursa KL Composite index in Malaysia was lower 0.81 or 0.06% to 1,298.86.

The Kospi Index in South Korea decreased 1.49 or 0.09% to close at 1,648.01. SET index in Thailand closed higher 17.37 or 2.36% to 752.20. The Sensex index in India increased 218.19 or 1.27% to 17,383.18. Markets in Indonesia were closed today.

Commodities, Metals, and Currencies

Crude oil increased $2.1 to $81.91 a barrel for a front month contract, natural gas edged down 4 cents to $4.35 per mBtu and gasoline increased 5.45 cents to 227.73 cents.

Soybean future closed up 15.00 cents to $9.45 a bushel. Wheat futures increased 7.75 cents in Chicago trading to $4.87 a bushel. Sugar closed down 1.15 cents at 18.24 cents per pound.

Gold increased $22.10 in New York trading to close at $1,127.30 per ounce, silver closed up $0.35 to $17.46 per ounce and copper for the front month delivery increased 6.10 cent to $3.37 per pound.

Dollar edged lower against euro to $1.376 and edged lower against the Japanese yen to 90.33.

Yield on 10-year U.S. bonds closed lower at 3.65% and with 30-year maturities closed at 4.63%.