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Uncertainty Over Fed Stimulus Leads Markets Lower

September 12, 2013 by

The stock market slipped on Thursday, ending a seven-day winning streak for the Standard Poor’s 500-stock index, as a drop in precious metal prices dragged mining shares lower.

Gold fell $33.50, or 2.5 percent, to $1,330.40 an ounce as traders remained hopeful that the Syria crisis would be resolved without an American military strike.

“Gold is a fear factor commodity, and so hope of a resolution is causing prices to go down a little bit,” said Bryant Evans, portfolio manager at Cozad Asset Management.

Gold prices also came under pressure from continued speculation that the Federal Reserve will begin to wind down its economic stimulus program when it meets next week.

Economic data showed that first-time weekly claims for state unemployment benefits, the last major reading on the labor market before the Fed’s meeting, fell to the lowest level since 2006, but the picture was incomplete because two states did not process all their claims.

The S. P. materials sector fell 1 percent, with Newmont Mining dropping $1.23, or 4.18 percent, to $28.23.

The S. P. 500 fell 5.71 points, or 0.34 percent, to 1,683.42. The index had risen about 3.4 percent over the previous seven sessions.

The Dow Jones industrial average dropped 25.96 points, or 0.17 percent, to 15,300.64. The Nasdaq composite index was down 9.04 points, or 0.24 percent, at 3,715.97.

Much of the focus of the financial markets has shifted to the Fed policy-making meeting, when a decision is expected about when to reduce its $85 billion-a-month purchases of Treasury and mortgage-backed securities.

Economists at a majority of primary dealers expect the Fed to announce it will cut its bond purchases, according to a recent Reuters poll. But such a move would also indicate the Fed sees the economy in better shape than many think.

Among the stocks on the move on Thursday, Lululemon Athletica slumped $3.73, or 5.4 percent, to $65.29, after the apparel retailer reported second-quarter results and trimmed its outlook.

Shares of Walt Disney gained $1.55, or 2.42 percent, to $65.49, after the media giant said it would increase its stock buybacks.

Also on the upside was NetSol Technologies, which jumped 97 cents, or 9.51 percent, to $11.17, after the software maker reported that its fiscal fourth-quarter earnings nearly doubled.

In the bond market, interest rates were stable. The price of the Treasury’s 10-year note rose
2/32, to 96 17/32, while its yield was unchanged at 2.91 percent.

Article source: http://www.nytimes.com/2013/09/13/business/daily-stock-market-activity.html?partner=rss&emc=rss

Filed Under: Economy News Tagged With: , ,

Sunnier Data From China Lifts Wall Street Trading

September 9, 2013 by

The stock market moved sharply higher on Monday, with the Nasdaq composite index ending at its highest since September 2000, after upbeat data from China increased optimism about the health of the global economy.

Investor sentiment was also lifted by merger activity and easing concern about a potential American military strike on Syria.

The Standard Poor’s 500-stock index closed higher for a fifth straight session, posting its best daily performance since Aug. 1, while all 10 S. P. sectors ended higher. More than 70 percent of companies that trade on the New York Stock Exchange and Nasdaq exchange posted gains.

Basic materials shares led the day’s gains, rising 1.5 percent, after China’s August exports handily beat market expectations while consumer inflation there held steady. United States Steel shares jumped 66 cents, or 3.5 percent, to $19.53, while Alcoa rose 16 cents, or 2 percent, to $8.08.

“This is more proof that the Chinese government’s attempts to stabilize the country’s economy are helping, and that really got us up and running,” said Donald Selkin, chief market strategist at National Securities.

Equities added to their gains in afternoon trading as it appeared less likely that a resolution authorizing military strikes against Syria would be approved easily by Congress.

Geopolitical uncertainty related to Syria has been a major market driver in recent weeks, with investors especially concerned about the potential impact on the oil market.

Senator Harry Reid, Democrat of Nevada and the majority leader, scheduled a test vote for later this week, but it was unclear whether the measure would attract enough backing to clear anticipated procedural roadblocks.

“Every poll shows it would be very difficult for Obama to get authorization, and that might be enough to delay any action or at least make the action more cautious,” Mr. Selkin said. “Both of those would give the market a leg up.”

Separately, a Russian proposal to place Syria’s chemical weapons under international control was welcomed by the government in Damascus, which praised the Kremlin for seeking to “prevent American aggression.”

The Dow Jones industrial average rose 140.62 points, or 0.94 percent, to 15,063.12. The S. P. 500 gained 16.54 points, or 1 percent, to 1,671.71. The Nasdaq picked up 46.17 points, or 1.26 percent, to 3,706.18.

Deal news gave a further lift to market confidence.

Koch Industries agreed to buy the electronic connectors maker Molex for about $7.2 billion.

Ares Management and the Canada Pension Plan Investment Board reached a deal to buy the privately owned luxury retailer Neiman Marcus for $6 billion.

Molex shares surged $9.29, or 31.7 percent, to $38.63 as the S. P.’s top gainer.

Shares of home builders rallied as investors bet that the rise in mortgage rates was nearly over. Pulte Group stock added $1.16, or 7.5 percent, to $16.63.

In the bond market, interest rates eased. The price of the Treasury’s 10-year note rose 6/32, to 96 15/32, while its yield dipped to 2.91 percent, from 2.93 percent late Friday.

Article source: http://www.nytimes.com/2013/09/10/business/daily-stock-market-activity.html?partner=rss&emc=rss

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G.D.P. Report Gives Stocks a Lift

August 29, 2013 by

Stocks on Wall Street rose on Thursday on strong economic data and a possible large deal between Vodafone and Verizon, while a potential Western military strike on Syria appeared to be delayed for now.

In afternoon trading the major indexes were off their highs for the day: the Standard Poor’s 500-stock index was 0.3 percent higher, the Dow Jones industrial average was 0.2 percent higher and the Nasdaq composite was up 0.8 percent.

Data showed the American economy grew more quickly than expected in the second quarter thanks to a surge in exports. The strong numbers, alongside data suggesting a strengthening in job gains in August, could bolster the case for the Fed to wind down a major economic stimulus program that has been a pillar of the recent rally in equities.

The numbers show the economic recovery may have started in the first half of the year, and the economy is strong enough to allow for the Fed to scale back its stimulus, said Philip J. Orlando, chief equity market strategist at Federated Investors in New York.

Shares of the Vodafone Group traded in the United States jumped 7.5 percent after the company said it was in talks with Verizon Communications to sell its 45 percent stake in their joint venture, Verizon Wireless. Verizon shares rose 2.8 percent.

Merger and acquisition activity “tells us companies have a lot of firepower, the ability to use cash, a lot of debt they could utilize and currency for stock deals, all that is positive” for the market, Mr. Orlando said.

European stocks ended the trading day higher. London’s FTSE 100 gained 0.8 percent, the DAX in Frankfurt was 0.5 percent higher and Paris’s CAC 40 rose 0.7 percent.

Asian markets closed mostly higher, with Japan’s Nikkei up 0.9 percent and the Hang Seng in Hong Kong gaining 0.8 percent. But the Shanghai Composite fell 0.2 percent.

The dollar rose against the yen, though hard-hit currencies in India, Brazil and Indonesia bounced higher against the dollar as their central banks moved to stem capital outflows.

In the oil markets, the reduced likelihood of an immediate major supply disruption allowed United States benchmark oil to drop, but the price picked up in afternoon trading, down just 14 cents a barrel, to $109.96, after its near 4 percent gain over the last two days.

“The market is reassessing the supply implications of the conflict in Syria,” said Eugen Weinberg, global head of commodities at Germany’s Commerzbank.

Gold eased 0.4 percent, to $1,412.40 an ounce, after reaching a three-and-a-half-month high in Wednesday’s flight to safety.

Article source: http://www.nytimes.com/2013/08/30/business/daily-stock-market-activity.html?partner=rss&emc=rss

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