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Wall Street Moves Up

March 19, 2013 by Leave a Comment

Wall Street stocks fell on Tuesday as a planned tax on bank accounts to help pay for Cyprus’s bailout appeared doomed in parliament, fueling caution among traders about the euro zone crisis.

The Standard Poor’s 500-stock index fell 0.6 percent in afternoon trading, the Dow Jones industrial average lost 0.3 percent and the Nasdaq composite index dropped 0.6 percent.

A vote on the plan, which European officials proposed over the weekend, may not even take place on Tuesday as planned after a government spokesman said it was unlikely to pass. The Cypriot government proposed to spare small savers from the tax.

Investors took advantage of the unease in Europe to cash in some recent gains.

“The market is not acting as if there is a reason to panic, but it is another thing people need to look at,” Doreen Mogavero, chief executive of Mogavero, Lee Co., said about Cyprus from the floor of the New York Stock Exchange. “It’s enough reason to be cautious.”

The overhanging concern was that account holders in other parts of Europe could make a run on their banks on concerns they will also be taxed to help their struggling economies. No sign of a bank run or any proposal to tax accounts outside Cyprus appeared.

European bank shares extended their decline on Monday, as the sector’s index fell 2.2 percent. Market indexes overall were down from 0.3 percent to 2.2 percent in Europe.

In the United States, data showed housing starts rose in February and new permits for construction rose to their highest level since 2008.

“The data was good, but at the same time we need to think about, now that the housing market is getting better, will the Fed have to wait longer to get their foot off the gas pedal?” said Joe Saluzzi, co-head of trading at Themis Trading.

Among individual stocks experiencing large moves on Tuesday, shares of Citigroup — which agreed on Monday to pay $730 million to settle a class-action lawsuit on behalf of investors who said they were misled by the company’s disclosures — were up 0.6 percent.

The drug maker Affymax said it was considering selling itself or filing for bankruptcy protection among a range of alternatives, as it struggled to stay afloat after the recent recall of its sole commercial product, the anemia drug Omontys. The stock plunged 57.5 percent on Tuesday.

Article source: http://www.nytimes.com/2013/03/20/business/daily-stock-market-activity.html?partner=rss&emc=rss

Filed Under: Economy News Tagged With: , ,

Resistance in Cyprus Grows to Europe’s Bailout Plan

March 18, 2013 by Leave a Comment

President Nicos Anastasiades was trying to compel policy makers in Brussels to soften demands for a tax to be assessed on Cypriot bank deposits, saying European Union leaders used “blackmail” to get him to agree to those conditions early Saturday in order to receive a bailout package worth 10 billion euros, or $13 billion.

Cyprus, whose banking system is verging on collapse, is now the fifth nation in the 17-member euro union to seek financial assistance since the crisis broke out three years ago.

As anger in this country swelled against the measure, Mr. Anastasiades delayed an emergency vote parliamentary vote on the bailout plan until Tuesday, the second step in as many days. Faced with a lack of support from lawmakers, the vote could be delayed until as late as Friday.

The government also said it would keep Cypriot banks shuttered until at least Wednesday, beyond a bank holiday that was supposed to end Monday, a move aimed at staving off a possible bank run.

Cyprus’s banking association issued a statement calling on people to remain “calm,” saying it was ready to implement whatever measures were needed to protect the stability of the banking sector. The association said it would instruct banks to load automated teller machines with cash while banks remained closed.

Financial markets stuttered on the news, with Asian stocks suffering the most, closing down about 2 percent. European market indexes were off about 1 percent by the end of the session, and Wall Street shares were less than 0.2 percent lower in afternoon trading.

For the first time since the onset of the euro zone sovereign debt crisis and the bailouts of Greece, Portugal and Ireland, ordinary depositors — including those with insured accounts — were being called on to bear part of the cost, €5.8 billion.

The previous bailouts have been financed by taxpayers, and the new direction raised fears that depositors in Spain or Italy, two countries that have struggled economically of late, might also take flight.

A crowd of protesters gathered in front of the presidential palace, shouting angrily at Mr. Anastasiades and inveighing against Germany and European leaders as he entered the building to meet with his cabinet. “Merkel, U stole our life savings,” read one banner tied to a bus stop. “EU, who is next, Spain or Italy?” read another.

Miguel Arias Cañete, Spain’s agriculture minister, told journalists in Brussels on the sidelines of a European Union meeting on Monday that he saw no risk of contagion. Spain’s banking system had undergone “a very rigorous clean-up,” the minister said, and were now in a “magnificent situation” following their bailout last year.

The finance ministers from the euro zone countries were to take up the Cyprus issue on a conference call later Monday. Jeroen Dijsselbloem, the president of the group, had declined Saturday to rule out taxes on depositors in countries beyond Cyprus, although he said such a measure was not being actively considered.

A key question for the finance ministers was expected to be whether any revised formula for the tax on deposits could still deliver the 5.8 billion euros agreed to in the bailout deal. The plan, a so-called bail-in, also would wipe out 1.4 billion euros held by junior bondholders in Cypriot banks. Only senior bondholders, who have paid a premium to be first in line for repayment of their investments, would be fully protected.

Joerg Asmussen, a member of the European Central Bank governing council, suggested that creditors may not object to a revision of the bailout terms.

This article has been revised to reflect the following correction:

Correction: March 18, 2013

An earlier version of this article incorrectly reported the days banks in Cyprus would remain closed. The central bank said they will stay shut through Wednesday.

Article source: http://www.nytimes.com/2013/03/19/business/global/asian-markets-drop-on-latest-euro-concerns.html?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,

Shares Eke Out a Slim Gain

March 13, 2013 by Leave a Comment

Wall Street stocks ended fractionally higher on Wednesday after data showed retail sales rose more than expected in February.

The Standard Poor’s 500-stock index gained 0.1 percent, the Dow Jones industrial average added about 5 points and the Nasdaq composite index rose 0.1 percent by the end of trading. European market indexes closed moderately lower.

Investors had been looking for signs of any impact on spending triggered by elevated unemployment and a higher payroll tax that went into effect at the start of the year, but the Commerce Department said retail sales increased 1.1 percent, the largest rise since September.

“That was a better-than-expected report across the board, even the numbers excluding autos and gas were better than expected,” said Peter Jankovskis, co-chief investment officer at OakBrook Investments in Lisle, Ill. “So much for the increase in payroll taxes. Pretty much it’s been a regular habit that the numbers have been coming in better than expected.”

Other data showed import prices rose more than expected in February, driven by the biggest increase in fuel prices since August, while export prices rose 0.8 percent for the month, the largest monthly gain since September.

The Dow recorded a ninth consecutive day of gains and the S.P., at 1,554.51, was still climbing toward its closing high set on Oct. 9, 2007, 1,565.15.

Boeing slipped 0.3 percent after the company won approval from the Federal Aviation Administration on Tuesday to start testing a redesigned battery for the 787 Dreamliner, putting it a step closer to returning the troubled airplane to regular service.

Coach shares rose 2 percent after Citigroup raised its rating on the stock to buy from neutral.

But Express Inc. slumped 9.1 percent after the apparel retailer posted fourth-quarter earnings and said it was off to a slow start in the first quarter.

Spectrum Pharmaceuticals shares tumbled 35.7 percent after the company forecast a steep drop in full-year sales as it expects uptake of its biggest-selling product, the colon cancer drug Fusilev, to significantly drop as cheaper generics enter the market.

Article source: http://www.nytimes.com/2013/03/14/business/economy/shares-slip-despite-economic-data.html?partner=rss&emc=rss

Filed Under: Economy News Tagged With: , ,

Stocks End Quarter With Steep Loss

September 30, 2011 by Leave a Comment

Stocks closed a dismal third quarter with a sharp loss after data showed only a slight increase in American consumer spending and an unexpected rise in European inflation.

Hurt by investor fears about the crisis in the euro zone and signs that the global economy may tip into recession, the July-September quarter was set to go down as the worst three months for global equities in years.

The Standard Poor’s 500-stock index was off more than 14 percent for the quarter — and more than 10 percent for the year so far. The German, French and Spanish market indexes also recorded their biggest quarterly losses in nine years, Reuters calculated.

The Commerce Department on Friday said consumer spending in the United States in August rose 0.2 percent, while incomes actually fell for the first time in nearly two years.

By the close, the S.P. 500 was down 2.5 percent for the day, shedding 28.98 points to 1,131.42. The Dow Jones industrial average ended 2.2 percent lower, off 240.60 points to 10,913.38, and the Nasdaq composite index lost 2.6 percent, or 65.36 points to 2,415.40.

The Dow ended the quarter down 12 percent and the Nasdaq lost 13 percent.

In Europe, consumer prices in the 17 European Union nations that use the euro rose 3 percent in September, after a 2.5 percent increase in August, the largest increase since October 2008.

Coming on the heels of data showing declining consumer confidence in Europe and evidence that the economy is slowing in much of the region, the inflation figures complicate the monetary policy challenge facing the European Central Bank, which has a primary responsibility to maintain price stability.

Still, said Ben May, an economist at Capital Economics in London, investors are right to continue expecting another move by the European Central Bank to cut interest rates by the end of 2011, noting that so-called “core” inflation, which subtracts energy and food prices because of their volatility, appeared to be well below the bank’s 2 percent target.

“What’s more, any rise is likely to prove temporary, given the recent signs that the recovery is coming to an end,” Mr. May said.

The United States Federal Reserve, the Bank of England, the Swiss National Bank and the Bank of Japan all have set their main overnight target interest rates at close to zero.

The Euro Stoxx 50 index, a barometer of euro zone blue chips, closed down 1.5 percent, while the FTSE 100 index in London slid 1.3 percent. The DAX in Germany lost 2.4 percent.

American crude oil futures for November delivery fell 1.8 percent to $80.68 a barrel. Comex gold futures rose 0.5 percent to $1,624.10 an ounce.

Wheat and corn futures traded in Chicago plunged by their daily limit, Bloomberg News reported, after a government report showed bigger inventories of wheat in the United States than forecast.

The dollar gained against most other major currencies. The euro fell 1 percent, to $1.3445, while the British pound rose 0.1 percent, to $1.5628. The dollar rose 0.4 percent against the Japanese currency, to 76.11 yen, and it rose 0.8 percent against its Swiss counterpart, rising to 0.9046 francs.

Asian shares were mixed, with both the Tokyo benchmark Nikkei 225 stock average and main Sydney market index, the S.P./ASX 200, essentially unchanged. But the Hang Seng index in Hong Kong fell 2.3 percent and in Shanghai the composite index fell 0.3 percent.

Bond prices were mostly higher, with the yield on the benchmark 10-year Treasury note dipping 9 basis points to 1.903 percent and the yield on the German 10-year falling 10 basis points to 1.9 percent.

David Jolly reported from Paris.

Article source: http://www.nytimes.com/2011/10/01/business/daily-stock-market-activity.html?partner=rss&emc=rss

Filed Under: Global Business Tagged With: , ,

U.S. Market Indexes Up Sharply

August 30, 2011 by Leave a Comment

Wall Street surged in a broad rally on Monday as a merger between big Greek banks provided rare encouraging news from debt-stricken Europe, while a rebound in American consumer spending calmed fears of a new recession.

At the close, the Standard Poor’s 500-stock index was up 33.28 points, or 2.8 percent, at 1,210.08. The Dow Jones industrial average of 30 blue-chip stocks rose 254.71 points, or 2.26 percent, to 11,539.25. The Nasdaq composite index was up 82.26 points, or 3.32 percent, at 2,562.11.

Since Aug. 8, when the S. P. 500 hit its recent low of 1,119.46, the index has risen about 8 percent.

Since the Dow’s recent low of 10,719.94 on Aug. 10, the average has gained about 7.4 percent and is within about 50 points of where it started the year.

Financial stocks were the greatest gainers on Monday after Alpha Bank and Eurobank EFG sealed a merger that was expected to prompt more deals to shore up a sector battered by the euro zone’s debt crisis and recession.

The banks “need to strengthen their balance sheets, and this would help with that, making the sector less worrisome,” said David Ruff, portfolio manager at the Forward Select EM Dividend Fund in San Francisco.

“We’ll probably need to see greater policy action in the region,” Mr. Ruff said. “But the merger needs to be done, and that’s why we’re seeing a pause in the recent selling pressure.”

The S. P. financial index was up 3.4 percent and the KBW Banks index added 3.6 percent. Bank of America rose 8.12 percent to $8.39 and JP Morgan Chase gained 4 percent to $37.64. New York-listed shares of National Bank of Greece soared 37.7 percent to $1.15.

Insurers also rose as property damage from Hurricane Irene was less than feared, according to early estimates. Travelers rose 5.1 percent to $50.75, while Allstate jumped 7.6 percent to $26.30.

Oil prices were up $1.90, to $87.27 a barrel. They extended gains from Friday, when they rose on the possibility of new stimulus from the Fed. The Fed chairman, Ben S. Bernanke, left the door open for such stimulus in a speech on Friday in Jackson Hole, Wyo.

Mr. Bernanke, in his annual address to central bankers, gave no details on whether the Fed was planning to flood markets with more dollars to help the economy. But he said the central bank’s policy panel would meet for two days next month instead of one to discuss additional monetary stimulus, offering hopes of a move then.

Some analysts say it may be hard for Mr. Bernanke and the Fed to follow through with another round of bond buying after the $600 billion program that expired in June.

“He has a much, much harder decision this time,” Jim Walker, founder of Asianomics, told Reuters television. “What he’s got to do is convince the dissenting voices in the Fed — and there are now three of them — that economic growth is so bad that it is time to use even more extraordinary measures.”

Commodities around the world have had a volatile month, and gold prices fell again on Monday. Gold futures were down $5.70 to $1,788.40. “With a possibility of a stimulus package from the Fed in the weeks ahead, risk appetite seems to have returned to the markets and safe havens are being dumped,” said Pradeep Unni, senior analyst at Richcomm Global Services.

The Treasury’s 10-year note fell 21/32, to 98 25/32. The yield rose to 2.26 percent, from 2.19 percent late Friday.

Consumer spending recorded its largest increase in five months in July, supporting views that the economy was not falling back into recession. While the number of signed contracts for home sales in July fell 1.3 percent, the decline matched forecasts and topped year-ago levels.

“Consumer spending has been focused on the past couple of months, so any kind of strength there is a good thing for the economy and the market,” said Brian Lazorishak, portfolio manager at Chase Investment Counsel in Charlottesville, Va.

The New York Stock Exchange and the Nasdaq opened on schedule, but trading volume was light. Many workers were stuck at home because many commuter rail and bus lines were not operating the day after Hurricane Irene swept the region.

Article source: http://feeds.nytimes.com/click.phdo?i=eabbf145fca502ee010b01ce72d40812

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