April 19, 2018

Wall Street Shares Slide

Stocks slid on Wall Street on Thursday, as data continued to show a slowly improving economy.

The Standard Poor’s 500-stock index declined 0.8 percent, the Dow Jones industrial average lost 0.5 percent and the Nasdaq composite index fell 1.3 percent in afternoon trading. European markets ended down about 2 percent.

In one economic report released Thursday, the Labor Department said the number of Americans filing new claims for unemployment benefits rose 20,000 to a seasonally adjusted 362,000, above expectations for 355,000.

In another report, the government said consumer prices were flat for a second straight month in January, providing scope for the Federal Reserve to maintain its very accommodative monetary policy stance as it tries to stimulate the sluggish economy. Excluding food and energy, consumer prices rose 0.3 percent, the largest gain since May 2011.

The S.P. 500 index dropped 1.2 percent on Wednesday, its biggest decline since Nov. 14, after minutes from the Federal Reserve’s most recent meeting suggested the central bank may slow or stop buying bonds sooner than expected.

With the benchmark S.P. index still up 6 percent for the year, many analysts considered the Fed minutes as a trigger for an overdue pullback in equities, as would be the upcoming sequestration in Washington. The sequestration — automatic across-the-board spending cuts put in place as part of a larger congressional budget fight — is due to begin March 1 unless lawmakers agree on an alternative.

“It’s the sequester, it’s the knee-jerk reaction to yesterday’s Fed minutes and it’s the realization the consumer is slowing,” said Phil Orlando, chief equity market strategist at Federated Investors in New York. “I’d love to see a healthy 5 percent correction. Let’s wash out some of the weak hands and set up for a better move during the year.”

Wal-Mart rose 2.2 percent after the world’s largest retailer reported a larger-than-expected rise in quarterly profit and raised its dividend. Investors weighed the news of better profit against persisting weakness in sales in the United States.

VeriFone Systems tumbled 41 percent after the credit card swipe-machine maker forecast first- and second-quarter profit that were well below analysts’ expectations.

Berry Petroleum jumped 17 percent after the oil and gas producer Linn Energy said it would buy the company in an all-stock deal valued at $4.3 billion including debt.

Article source: http://www.nytimes.com/2013/02/22/business/daily-stock-market-activity.html?partner=rss&emc=rss

Stocks & Bonds: U.S. and European Markets Rise on Optimism Over Greek Vote

A relief rally swept the European and American markets after an early Wednesday vote by the Greek Parliament to approve an austerity plan.

The plan was passed, a condition set by international lenders for providing more financing and preventing a default, after weeks of uncertainty in financial markets related to the debt problems in the euro zone.

Investors had been bracing for the Greek Parliament’s decision on the package, which includes unpopular wage cuts, tax increases and privatizations. While investors got some relief with the announcement that it had passed, analysts warned that unresolved fiscal issues remained.

“Today’s vote will certainly give some short-term relief to markets, but concerns about the long-term feasibility of Greece’s fiscal plans still remain in place,” said Diego Iscaro, an IHS Global Insight senior economist, in a research note after the vote.

Protests continued outside the Parliament building in Athens. A second vote was scheduled for Thursday on enabling legislation to set the timing of the privatizations, especially of Greece’s state-owned electric utility.

With so much anticipation before the vote, analysts said that by the time it took place, investors had fixed positions.

“This is classic ‘buy the rumor, sell the news,’ ” said Phil Orlando, chief equity market strategist at Federated Investors. “The equity market was up in anticipation. We priced it in ahead of time.”

Still, the news was enough to lead major indexes higher. The DAX index in Frankfurt closed up 1.7 percent at 7,294.14, while the FTSE 100 in London rose 1.5 percent to 5,855.95.

In the Asia-Pacific region on Thursday, the reaction was muted, with the Nikkei 225 flat by the midday break in Tokyo. On Wednesday, the Nikkei had risen 1.5 percent on optimism that the Greek Parliament would pass the austerity measures.

Stocks in South Korea edged up 0.3 percent on Thursday, and Singapore and Taiwan climbed 0.7 percent. In Hong Kong, the Hang Seng index was 1.7 percent higher by midmorning.

In the United States, the Dow Jones industrial average closed up 72.73 points, or 0.60 percent, at 12,261.42. The Dow has now risen every day this week, putting it up 326.84 points, or 2.74 percent, in that period.

The Standard Poor’s 500-stock index was up 10.74 points, or 0.83 percent, at 1,307.41 and the Nasdaq composite index was up 11.18 points, or 0.41 percent, at 2,740.49.

The Treasury’s 10-year note fell 24/32, to 100 1/32. The yield rose to 3.12 percent, from 3.03 percent late Tuesday.

Bank stocks helped lift the Dow, and Bank of America was the most actively traded in the broader markets’ financial sector, which rose more than 2 percent. Bank of America, which said it would set aside $14 billion to pay investors who bought securities it assembled from mortgages that later soured, rose nearly 3 percent to $11.14. The company said it expected the agreement to lead to a second-quarter loss of $8.6 billion to $9.1 billion.

Citigroup was up more than 3 percent at $41.50. Morgan Stanley rose 4.75 percent to $23.39.

Other sectors that forged ahead were materials and energy, which each closed more than 1 percent higher. Oil closed up $1.88 at $94.77.

Yields on benchmark 10-year Spanish, Portuguese and Greek bonds declined, while those in safer equivalents issued by Germany and France rose, indicating investors were willing to switch back into riskier securities.

 The euro ended the day at $1.4431, up slightly from $1.4370 Tuesday.

The agreement by Greek lawmakers on the austerity measures was a crucial step in the international rescue of the crippled economy, and the relatively muted market reaction to the vote showed that investors knew that the country’s financial troubles were far from over.

“What’s really important is not the vote itself,” said George Magnus, senior economic adviser at UBS in London, “but the implementation of what they’re voting on, and that’s where the programs will come unstuck.”

The vote was critical to unlocking near-term financing, specifically the disbursement of the fifth installment of the original 110 billion euro bailout for Athens (roughly $140 billion when agreed to last year).

That installment would be worth 12 billion euros and would enable Greece to meet obligations like bond coupon payments in July, while paving the way for a new international lending program to provide financing through 2014.

Euro area ministers are expected to provide details of the program on July 3.

In a research report released Tuesday, Citigroup analysts said: “Despite the aid package, eventual Greek haircuts may be inevitable, with estimated private sector haircuts of 65 to 77 percent,” referring to the write-downs that bond holders will be required to accept.

“In other words, a bailout package addresses the liquidity issue much more than the solvency issue,” Citigroup said.

Two Commerzbank analysts, Benjamin Schröder and Peggy Jäger, said early Wednesday that “even if the bills are passed, worries could still linger on for longer, if no broader consensus across Greek political parties forms.”

Bettina Wassener contributed reporting from Hong Kong.

Article source: http://feeds.nytimes.com/click.phdo?i=e87656d09a002edd4e1dc496c875f276

A Nosedive Eases a Bit in Volatile U.S. Trading

European debt troubles and signs of a sluggish economy in the United States have unsettled investors for months, and Thursday was no different. Stocks fell sharply early, pushing the Dow Jones industrial average down nearly 2 percent before it rallied on new hopes for a Greek austerity plan.

The seesaw session and small drop in stocks at the close pointed to generally gloomy investors hopping from headline to headline as they sought clarity. The volatility also signals further fluctuations in sentiment, with stocks headed for an unclear direction on Friday. After posting losses for six of the last seven weeks, the Standard Poor’s 500-stock index was showing a weekly gain of nearly 1 percent at Thursday’s close. It has fallen just nearly 6 percent since the end of April.

“The Greece situation has been a threatening dark cloud hanging over the markets,” said Lawrence R. Creatura, portfolio manager at Federated Investors.

“We are in uncertain times, everybody knows it and that creates volatility, but also opportunity.”

The Dow Jones industrial average fell 59.67 points, or 0.49 percent, to 12,050 on Thursday. The S. P. 500 declined 3.64 points, or 0.28 percent, to 1,283.50, and the Nasdaq composite index rose 17.56 points, or 0.66 percent, to 2,686.75.

Greek debt problems have battered markets for weeks with concerns about contagion to other countries in the euro zone and its effect on banks.

At the same time, the latest economic data has served as reminders of the challenges to the United States economy, including a slowdown in hiring in May and a housing sector that is still trying to recover.

The seesaw in stocks started shortly after the open, when the Dow, less than two hours into trading, fell 234.73 points, or 1.9 percent, to its intraday low of 11,874.94.

Analysts offered a range of reasons for the slump, starting with the Federal Reserve saying on Wednesday that the economy was not expanding as quickly as predicted and that it would complete the purchase of $600 billion in Treasury securities next week, then pause.

Late Wednesday, Jean-Claude Trichet, president of the European Central Bank, said that the link between the Greek debt problem and banks was “the most serious threat” to financial stability in the European Union, according to Bloomberg News.

On Thursday, the Labor Department said initial claims for unemployment were up 9,000, to 429,000 last week, according to seasonally adjusted figures. The four-week moving average was unchanged at 426,000.

Stanley A. Nabi, the chief strategist at Silvercrest Asset Management Group, said the debt troubles in Europe were only one of the factors affecting the market on Thursday. “I think the decline is substantially connected to the Fed having lowered economic expectations for the next several quarters,” he said. “And then the employment data that came out this morning was not particularly robust.”

Adding to the uncertainty, some analysts said, was the International Energy Agency announcement that the United States would provide half of the 60 million barrels of petroleum reserves being released to world markets, with other nations releasing the rest. The action is meant to replace some of the oil production lost because of the conflict in Libya.

“It shocked the market,” said Doug Cote, the chief market strategist for ING Investment Management. “This looks like thinly veiled stimulus,” he said. “The big question weighing on the market is why now?”

But other analysts said the oil announcement suggested consumers could get relief at the gas pump, and that mostly sovereign debt and economic issues, including the faltering United States federal budget talks, were to blame for pushing stocks lower.

News at the end of the day that Greece had reached some approval for austerity measures helped the indexes recover.

“It was kind of a rocky ride over the last hour,” said Stephen J. Carl, head equity trader at the Williams Capital Group.

“It was almost an 11th-hour save,” said Mr. Creatura.

European markets were down. The FTSE 100 in London fell 1.71 percent on Thursday, while the CAC 40 in Paris declined 2.16 percent and the DAX index in Germany dropped 1.77 percent.

“Investors are worried about the same things that have been worrying them for some months,” said Adrian Darley, head of European equities at Ignis Asset Management in London. “It’s the weak U.S. data, a consensus of overheating in China and concerns about Europe. The Greek situation is still unsolved and markets are going to remain very nervous.”

The Treasury’s 10-year note rose 18/32, to 101 26/32. The yield fell to 2.91 percent, from 2.98 percent late Wednesday.

Energy and bank stocks in the were down nearly 2 percent. Airline stocks, sensitive to oil prices, rose. Exxon Mobil was down 1.73 percent, to $78.44. Chevron fell 1.69 percent, to $99.36. Marathon Oil declined 2.22 percent, to $51.62.

Julia Werdigier contributed reporting from London.

Article source: http://feeds.nytimes.com/click.phdo?i=1f512193048acfd5d729a477f67eb131