WORLD MARKET UPDATES
https://globaleconomic-trendsanalysis.blogspot.com/2011/04/world-market-updates_28.html
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With traders shrugging off a disappointing batch of economic data, stocks are turning in a lackluster performance in early trading on Thursday. The major averages are largely holding onto their recent gains, hovering near multi-year highs. Despite the release of the weaker than expected data, traders seem reluctant to cash in on the recent strength in the markets amid the continued release of upbeat corporate results. Before the start of trading, the Commerce Department released a report showing that the U.S. gross domestic product increased by less than expected in the first quarter. The Commerce Department said that GDP increased at an annual rate of 1.8 percent in the first quarter, reflecting a notable slowdown from the 3.1 percent growth seen in the fourth quarter of 2010. Economists had been expecting the pace of GDP growth to slow to 2.0 percent. A separate report from the Labor Department showed an unexpected increase in initial jobless claims in the week ended April 23rd, with claims rising to a three-month high. The report showed that initial jobless claims rose by 25,000 to 429,000 from the previous week's revised figure of 404,000. The increase surprised economists, who had expected jobless claims to fall to 390,000 from the 403,000 originally reported for the previous week. On the earnings front, consumer products giant Procter & Gamble (PG) reported first quarter earnings that rose year-over-year but came in slightly below analyst estimates. Looking ahead, the company lowered the high end of its full-year earnings forecast. Exxon Mobil (XOM) reported first quarter earnings of $2.14 per share on revenues of $114.0 billion compared to earnings of $1.33 per share on revenues of $90.25 billion in the year-ago quarter. Analysts had expected the oil giant to earn $2.06 per share on revenues of $114.9 billion. In other corporate news, continuing a recent string of multi-billion dollar acquisitions, utility company Exelon (EXC) has reached an agreement to acquire Constellation Energy (CEG) for $7.9 billion in stock. The deal values Constellation at $38.59 per share, a 12.5 premium to its closing price on Wednesday. Most of the major sectors are showing only modest moves, although notable strength has emerged in the railroad sector. Norfolk Southern (NSC) is helping to lead the sector higher after reporting stronger than expected first quarter earnings. Health insurance stocks are also seeing early strength, extending a recent upward move, while weakness has emerged among software, electronic storage, and oil service stocks. The major averages are currently mixed, with the Dow posting a modest gain. While the Dow is up 8.55 points or 0.1 percent at 12,699.51, the Nasdaq is down 5.08 points or 0.2 percent at 2,864.80 and the S&P 500 is down 0.87 points or 0.1 percent at 1,354.79. | ||||||||||||
European Market Reports | ||||||||||||
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European Markets Mostly Higher The European markets are mostly higher in afternoon trading Thursday, a day after theU.S. Federal Reserve decided to leave interest rates unchanged at near-zero levels. Positive earnings reports also influenced sentiment, as optimism about economic recovery encouraged risk appetite. The Euro Stoxx 50 index of euro zone blue chippers is adding 0.49 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, is sliding 0.03 percent. The German DAX is rising 0.37 percent, the French CAC 40 is up 0.39 percent and Switzerland's SMI is adding 0.39 percent. However, UK's FTSE 100 index is falling 0.14 percent. In Frankfurt, Deutsche Bank is leading the gainers by adding 4.9 percent. The lender reported a sharp increase in first-quarter profit, reflecting a 16 percent growth in net revenues. Peer Commerzbank is rising 1.4 percent. Carmaker Volkswagen is rising 2.6 percent, after several analysts raised their price targets on the stock. BMW is up 0.75 percent, while Daimler is losing 0.9 percent. Drugmaker Merck is rising 2.5 percent. The company reported a surge in first-quarter results. Bayer is gaining 0.4 percent after lifting its full year view. SAP is plunging 6.9 percent after the business software maker reported soft growth in the first quarter. Cheuvreux lowered its rating on SAP to "Underperform" from Outperform," dpa-AFX said. Drugmaker Sanofi-Aventis is down 0.3 percent in Paris. The company reported a lower profit for the first quarter. Technip is falling 2.4 percent. The French oil and gas services provider reported first-quarter results. In London, insurer Standard Life is surging 3.15 percent after issuing its interim management statement. Peer Legal & General is adding 2.2 percent. GlaxoSmithKline is adding 2.4 percent, as the company's profit in the first quarter increased, despite a drop in sales. Royal Dutch Shell is up 0.9 percent. The oil giant reported strong first-quarter results on rising crude prices. BP is down 1 percent. Morgan Stanley reduced its price target on BP to 550 pence from 565 pence, dpa-AFX said. Restaurant group Whitbread is leading the decliners by falling 4.5 percent, following a trading update. Unilever, which cautioned on its first-half operating margin, is declining 3 percent. AstraZeneca is down 2.3 percent. The drugmaker reported a 7 percent drop in pre-tax profit for the first quarter, hurt by generic competition and government price reforms. Credit Suisse raised its rating on Swedish power and automation technology companyABB to "Outperform" from "Neutral" and increased the price target to 26 Swiss francs from 24 francs, dpa-AFX said. The stock is adding 3.6 percent in Stockholm. In economic news, Germany's jobless rate remained unchanged at a seasonally adjusted 7.1 percent in April, the Federal Labor Agency said. Economists were expecting the rate to fall to 7 percent. Meanwhile, the Federal Statistical Office said German import prices rose at the slowest pace in four months in March. Import prices increased 11.3 percent year-on-year, after rising 11.9 percent in February. Month-on-month, prices rose 1.1 percent, matching February's gain. French consumer spending slipped 0.7 percent in March from the previous month, reversing a 0.9 percent rise in February, the statistical office Insee said. Economists had expected a 0.2 percent rise for March. Across Asia/Pacific, markets ended mixed. Australia's All Ordinaries slipped 0.03 percent, China's Shanghai Composite Index lost 1.3 percent and Hong Kong's Hang Seng dropped 0.37 percent. However, Japan's Nikkei 225 gained 1.63 percent. In the U.S., futures point to a cautious open on Wall Street. In the previous session, theDow rose 0.8 percent, the Nasdaq jumped 0.8 percent and the S&P 500 advanced 0.6 percent. Among commodities, crude for June delivery is slipping $0.13 to $112.63 per barrel and June gold is rising $14.7 to $1531.8 a troy ounce. | ||||||||||||
Asia Market Reports | ||||||||||||
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Asian Stocks End Mixed; Japan Extends Gains Asian stocks ended mixed Thursday, with the Japanese shares extending gains following overnight gains U.S. Wall Street stocks moved up after the Federal Reservevoted unanimously to continue its asset purchase program through June, while maintaining its benchmark interest rate near zero for an 'extended period.' Tokyo stocks closed sharply higher with the key Nikkei index jumping 1.63 percent. The benchmark Nikkei 225 Average advanced 157.90 points to 9,849.74 and the broader Topix index expanded 11.98 points or 1.43 percent to 851.85. Japanese investors shrugged off official data that showed industrial output and household spending suffered record falls last month in the aftermath of the March 11 disaster. Kyocera rose over 5 percent after reporting over 30 percent jump in its quarterly net profits, while Sony plunged nearly 5 percent on news that its online video game network had been hacked. Chinese shares closed lower with the benchmark Shanghai Composite Index ending down 37.74 points, or 1.29 percent to 2,887.67. China's second-largest cement company Anhui Conch Cement was the top loser, shedding 6 percent. The stock had climbed just over 35 percent over the past three months. Elsewhere, South Korean stocks ended flat amid profit taking, with the KOSPI edging up 1.65 points, or 0.07 percent, to 2,208.35. Hundai Motor soared over 7 percent after reporting a 46 percent jump in its first-quarter net profit at $1.74 billion and Kia Motors gained 2.71 percent. Oil refiner SK Innovation climbed 3.31 percent and S-Oil surged 5.36 percent. Hong Kong's Hang Seng index fell 87.21 points or 0.4 percent to 23,805.63, amid worries that China will further tighten its monetary policy. Property developers China Resources Land and China Overseas Land were down around 3 percent each. Oil producer PetroChina surrendered over 3 percent after its first quarter net profits missed consensus estimates. Upstream oil producer Cnooc also lost 2.0 percent and oil refiner Sinopec eased 0.8 percent. New Zealand's benchmark NZX-50 edged up for a second session, adding 11.71 points or 0.33 percent to 3503.76. The RBNZ kept the official cash rate at a record low 2.5 percent, as widely expected and noted the outlook for core inflation and the ongoing economic impact of the Canterbury earthquakes mean there's no need to raise interest rates any time soon. Telecom rose 3.3 percent amid expectation that the Commerce Commission would implement rules aimed at lowering cellular pricing in New Zealand by capping the rates that phone companies can charge each other for texts and voice calls that cross networks. Global engineering group Cavotec MSL Holdings added 3.50 percent after reporting a 33 percent growth in its quarterly revenues. Elsewhere, the Australian stocks ended flat, erasing early trading-gains amid a strongAustralian dollar, which rose to $109.48, its highest level since 1982. While financial stocks ended higher, miners retreated. The benchmark S&P/ASX200 index ended flat at 4,873.0, while the broader All Ordinaries index edged down 1.7 points, or 0.83 percent, to 4,952.30. Telstra Corp rose 1.8 percent after announcing that it secured exclusive rights to stream live Australian Rules Football matches. Computershare surged 7.7 percent on its acquisition of The Bank of New York Mellon Corp's Shareowner Services Business. Meanwhile, food company Goodman Fielder plummeted 9.1 percent after downgrading its full-year profit guidance. Global miners, Rio Tinto and BHP Billiton ended with marginal losses. Meantime, the Indian market is extending losses amid selling in blue chip stocks. TheNSE Nifty is losing 45 points to 5,788 and the BSE Sensex is slipping 146 points to 19299. | ||||||||||||
Forex Top Story | ||||||||||||
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Euro Holds Gains Versus Buck As U.S. Economy Sputters The euro kept most of its strong recent gains against the dollar on Thursday, after government data showed the U.S economy grew at an anemic pace in the first quarter. The Commerce Department said that gross domestic product increased at an annual rate of 1.8 percent, reflecting a notable slowdown from the 3.1 percent growth seen in the fourth quarter of 2010. Consumers were feeling the pinch of soaring energy prices. The euro has surged higher versus the dollar in recent weeks, and gains accelerated yesterday after the Fed kept its benchmark interest rate near zero and committed to the completion of its $600 billion asset purchase plan in June. The euro touched a 17-month peak of $1.4881 yesterday, and was holding at $1.48 this morning. Against the yen, however, the euro eased slightly to Y120.65 from near Y122. Choppy trading left the euro near GBP 0.8880 against the sterling. In economic news from Europe, Germany's unemployment fell below 3 million in April, bringing the total number of unemployed to its lowest level in nineteen years. A decline of 37,000 in the number of unemployed took the overall jobless level to a seasonally adjusted 2.97 million in April, the lowest figure since June 1992, data published by the Federal Labor Agency revealed Thursday. Meanwhile, Portugal's acting Prime Minister Jose Socrates said Thursday he is confident that Finland won't vote against the rescue package being negotiated for Lisbon. Socrates expects a final deal by mid-May.
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