|
Stocks See Early Weakness Amid Global Economic Worries
Stocks
moved to the downside at the start of trading on Monday, as traders
expressed continued concerns about the outlook for the global economy.
The major averages slid into negative territory, adding to the modest
losses posted last week.
The major averages have climbed off their lows for the young session but currently remain stuck in the red. The Dow is down 39.38 points or 0.3 percent at 13,540.09, the Nasdaq is down 19.14 points or 0.6 percent at 3,160.82 and the S&P 500 is down 5.74 points or 0.4 percent at 1,454.41.
The early weakness on Wall Street is
partly due to troubling news from overseas, including remarks from an
adviser to the People's Bank of China predicting that China's economic
slowdown will continue.
Song
Guoqing, a Peking University professor, forecast 7.4 percent Chinese GDP
growth in the third quarter and 7.3 to 7.4 percent growth in the fourth
quarter.
The numbers would
represent a continued slowdown from the 7.6 percent growth seen in the
second quarter and the 8.1 percent expansion in the first quarter.
Disappointing
economic news out of Europe is also weighing on the markets, with the
Ifo Institute saying its index of German business confidence fell to
101.4 in September from 102.3 in August. The drop surprised economists,
who had expected the index to edge up to 102.5.
Highlighting
an unexpected drop by the Ifo expectations index, which fell to 93.2 in
September from 94.2 in August, Danske Bank said the data clearly
signals that Germany is in recession.
Negative
sentiment has also been generated by news of a disagreement between
German Chancellor Angela Merkel and French President Francois Hollande
over the timing of the introduction of a banking union.
Reflecting concerns about the outlook for global demand, steel stocks are seeing considerable weakness in early trading. The NYSE Arca Steel Index has fallen by 1.6 percent, pulling back further off the four-month closing high it set earlier this month.
Gold stocks have also come under pressure, moving lower along with the price of the precious metal. With gold for December delivery sliding $14.50 to $1,763.50 an ounce, the NYSE Arca gold Bugs Index is down by 1.3 percent.
Housing,
brokerage, and semiconductor stocks are also seeing early weakness,
although selling pressure has remained relatively subdued.
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Monday. Japan's Nikkei 225 Index fell by 0.5 percent, while Hong Kong's Hang Seng Index ended the day down by 0.2 percent.
9/24/2012 9:54 AM ET
The major European markets have also moved to the downside on the day. While the French CAC 40 Index is down by 1.1 percent, the German DAX Index and the U.K.'s FTSE 100 Index are down by 0.7 percent and 0.5 percent, respectively.
In
the bond market, treasuries have moved moderately higher, extending the
upward move that was seen last week. Subsequently, the yield on the
benchmark ten-year note, which moves opposite of its price, is down by
3.5 basis points at 1.725 percent.
| Canadian Market |
 |
| CADUSD | Oil | Gold | Allbanc |
 |  |  |  |
| Please click on the images to view our interactive charts |
|
|
Canadian Stocks Slip As Commodities Falter - Canadian Commentary
Canadian
stocks were extending losses for a third session Monday morning as
commodities moved lower, with traders fretting over a recent batch of
downbeat manufacturing data out of Europe and China. Meanwhile, survey
results from Ifo Institute revealed German business sentiment dropped
for a fifth straight month in September to hit its lowest since early
2010.
The S&P/TSX Composite Index slipped 15.44 points or 0.12 percent to 12,368.16, after shedding 50 points or 0.50 percent in the past two sessions.
The price of Crude oil was moving lower Monday morning as risk appetite waned amid falling euro and equity markets. Crude for November lost $1.10 to $91.79 a barrel.
In the oil patch, Crescent Point Energy , Encana Corp. and Tourmaline Oil were down around 3 percent each.
The price of gold was moving lower Monday morning as the U.S. dollar was recovering from its recent losses versus a basket of currencies ahead of this week's economic data. gold for December shed $9.60 to $1,768.40 an ounce.
Among gold plays, Agnico-Eagle Mines and Newmont Mining (NMC.TO) were down around 3 percent each. Royal gold , Goldcorp. and Detour Gold slipped nearly 1 percent each.
Full-service
investment dealer Canaccord Financial Inc. lost 3 percent after it said
it would acquire the wealth management business of Eden Financial Ltd.,
a boutique UK private client investment management business for about
12.8 million pounds
Bio-pharmaceutical
company Medicure Inc.(MPH.V) announced its board approval for a
consolidation of its common shares on the basis of fifteen
pre-consolidation shares for each one post-consolidation share. The
stock dived 12 percent.
Meanwhile, Seabridge gold gained over 3 percent.
International pharmaceutical company Valeant Pharmaceuticals International Inc.
has acquired Visudyne, used to treat abnormal growth of leaky blood
vessels in the eye caused by wet age-related macular degeneration, from
QLT Inc. (QLT.TO) for about $62.5 million Shares of VRX gained 1 percent
and QLT Inc rose over 5 percent.
In economic news from the euro zone,
German business sentiment declined for the fifth consecutive month in
September, survey results from Ifo Institute revealed. The business
climate index fell to 101.4 from 102.3 in August. The index was forecast
to remain unchanged at 102.3. The index for current situation dropped
to 110.3 in September from 111.1. Economists had forecast a reading of
111. Likewise, the gauge of executives' expectations dropped to 93.2
from 94.2, and well below the consensus forecast of 95.
|
| European Market |
| |
| FTSE 100 | Euronext | Dax perf | CAC 40 |
 |  |  |  |
| Please click on the images to view our interactive charts |
|
|
European Markets Fall Amid Growth Concerns; Banks, Miners Under Pressure
The
European markets are moderate to notably lower in afternoon trading
Monday, following weak economic data from Germany, amid reports of
differences between Germany and France over plans to monitor Europe's
crisis-hit banks.
Growth worries
from China also garnered investor attention after Song Guoqing, an
academic adviser to the People's Bank of China, said he saw no signs of a
rebound in the third quarter and domestic investment is unlikely to
expand dramatically in the short - term.
A
report that appeared in Der Spiegel on Sunday showed that Eurozone
countries are planning to increase the size of the region's permanent
bailout fund dramatically.
The
governments are preparing to quadruple the capacity of the European
Stability Mechanism to 2 trillion euros from the current 500 billion
euros, the magazine reported citing a Finance Ministry spokesperson. "It
is currently being discussed in Brussels," the spokesperson was quoted
as saying.
German business sentiment
declined for the fifth consecutive month in September, reports said
citing survey results from Ifo Institute. The business climate index
fell to 101.4 from 102.3 in August, while it was forecast to remain
unchanged at 102.3.
The euro Stoxx 50 index of eurozone bluechip stocks is declining 1.03 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, is dropping 0.53 percent.
The German DAX is declining 0.74 percent and the French CAC 40 is falling 1.16 percent. The UK's FTSE 100 is dropping 0.61 percent and Switzerland's SMI is losing 0.44 percent.
In Frankfurt, Commerzbank is declining 4.5 percent after Nomura cut the stock to "Reduce" from "Neutral." Deutsche Bank is losing 1.4 percent.
Steel maker ThyssenKrupp is falling 3 percent. Tire maker Continental is losing 2.1 percent.
UBS cut E.ON to "Neutral" from "Buy." The stock is dropping 0.9 percent.
Rhoen-Klinikum is losing 1.3 percent even though Commerzbank raised its rating on the hospital operator.
Software AG is losing around 2 percent after a downgrade by Societe Generale.
Merck is gaining 1.2 percent and Bayer is adding around 1 percent.
In Paris, STMicroelectronics is losing 3.5 percent. Saint-Gobain is falling 3.2 percent.
Cement giant Lafarge and steel maker ArcelorMittal are dropping 2.6 percent each.
Among lenders, Credit Agricole is falling 2.5 percent. BNP Paribas and Societe Generale are losing 1.5 percent and 1.4 percent, respectively.
Geophysical
firm CGGVeritas has entered into an agreement with Fugro to acquire its
Geoscience Division, excluding the existing Multi-Client library and
nodes businesses for 1.2 billion euros in cash. CGG shares are declining
7.7 percent. Fugro is up 2.9 percent in Amsterdam.
In London, Anglo American is losing 3.2 percent and Antofagasta is falling 1.9 percent. Eurasian Natural Resources is declining 4.8 percent.
Among lenders, Royal Bank of Scotland and Barclays are declining 1.8 percent each.
JJB
Sports is surging around 14 percent. The firm's board has determined
that any sale of the trade, assets and brands would be effected through
an administration process. It is anticipated that the process to begin
the appointment of administrators of the company would begin today.
Swiss
bakery business Aryzta reported a decline in fiscal 2012 profit, while
revenues were benefited by improved performance in the food business.
The stock is falling 4.8 percent.
Volvo
is falling 2.7 percent in Stockholm. Volvo Car President and CEO Stefan
Jacoby, who suffered a mild stroke last week, has temporarily suspended
his duties within the company over the next month due to illness.
TNT
Express is falling 4.5 percent. The firm's chief executive officer
Marie-Christine Lombard has resigned to pursue a career outside the
Dutch package delivery company. The firm continues to expect to complete
the $6.77 billion deal with U.S. rival United Parcel Service, Inc.
(UPS) in early 2013.
Mediq is surging 48.5 percent in Amsterdam after receiving an acquisition proposal from Advent International Corp.
Across Asia/Pacific, Australia's All Ordinaries and Japan's Nikkei 225 slid 0.5 percent each while Hong Kong's Hang Seng dropped 0.2 percent. China's Shanghai Composite Index bucked the trend and advanced 0.32 percent.
In
the U.S., futures point to a lower open on Wall Street. In the previous
session, lingering uncertainty about the outlook for the markets helped
to keep trading activity subdued. While the Nasdaq inched up 0.1 percent, the Dow edged down 0.1 percent and the S&P 500 slipped 0.01 percent.
In the commodity space, Crude for November delivery is losing $1.23 to $91.66 per barrel and December gold is dropping $18.4 to $1759.6 a troy ounce.
|
| Asia Market |
|
Asian Markets Trade Weak On Economic Concerns
Asian
stock markets are trading notably lower on Monday with investors
pressing sales amid lingering concerns about the near term outlook for
the global economy. A flat lead from Wall Street where stocks ended mixed on Friday and lack of fresh triggers are also contributing to the subdued trend in the region.
In
the Australian market, mining, energy, consumer discretionary and
industrial stocks are mostly trading weak. Healthcare and property
trusts stocks are finding support, while financial stocks are trading
mixed.
The benchmark S&P/ASX 200 is currently down 30.3 points or 0.7 percent at 4,378. The broader All Ordinaries index is trading at 4,402, down 28.8 points or 0.7 percent from its previous close.
Top miners BHP Billiton (BHP,) and Rio Tinto (, RIO.L) are down 1 percent and 2.4 percent, respectively.
Among energy stocks, Woodside Petroleum, Oil Search and Origin Energy are down 1 to 2 percent, while Santos and Caltex Australia are down with modest losses.
In the banking space, ANZ Bank (), Commonwealth Bank of Australia and Westpac () are down marginally, while National Australia Bank is trading modestly higher.
Atlas
Iron and Myer Holdings are trading lower by 4.8 percent and 4.2
percent, respectively. Whitehaven Coal, Crown, Fairfax Media, ALS, Regis
Resources, Paladin Energy, Aurora Oil & Gas and Newcrest Mining are down 3 to 3.3 percent.
Iluka
Resources, Beach Energy, Arrium, Bluescope Steel, PanAust, Sims Metal
Management, Oz Minerals and Boral are also trading sharply lower.
Shares
of agricultural chemicals maker Nufarm Limited are down 1.8 percent
despite the company reporting good earnings results. The company said it
returned to full-year profitability despite one-off costs from legal
action and restructuring. Nufarm made a net profit of A$72.6 million in
the year to July 31, compared to loss of A$49.9 million in the previous
year.
In the currency market, the Australian dollar opened weak and was quoting at US$1.0447 in early trades, down from Friday's close of US$1.0464.
Stocks opened lower in the Japanese market with a stronger yen triggering
some selling in exporters and automobile stocks. As selling gained some
momentum, the market lost further ground subsequently and was trading
notably lower when the morning session ended.
Steel,
non-ferrous metals, chemicals and insurance stocks also traded weak.
Shares from electric power, services and railway sections found some
support.
The benchmark Nikkei 225
index, which opened at around 9,071 and declined to around 9,031, was
down 59.6 points or 0.7 percent to 9,050.3 at the end of the morning
session.
|
| Commodities |
| |
| USDCAD | USDEUR | USDGBP | USDJPY |
 |  |  |  |
| Please click on the images to view our interactive charts |
|
|
BoJ Minutes: Recovery To Resume For Japan's Economy
Members
of the Bank of Japan's monetary policy board said that Japan's economic
activity has started to pick up again after fading in recent months,
minutes from the board's meeting on August 8 and 9 revealed on Monday.
The
board members fully expect that Japan's economy will return to a
moderate recovery path on firm domestic demand and improving demand from
overseas economies, the minutes showed.
"Japan's
economic activity has started picking up moderately as domestic demand
remains firm mainly supported by reconstruction-related demand," the
minutes said. "Public investment has continued to increase. Business
fixed investment has been on a moderate increasing trend with
improvement in corporate profits. Against the background of improvement
in consumer sentiment, private consumption has continued to increase
moderately."
At the meeting, the
central bank held its benchmark uncollateralized overnight call rate at
0-0.1 percent and also kept the total size of the stimulus program at
JPY 70 trillion with the asset purchases of JPY 45 trillion and the
credit facility of JPY 25 trillion.
The
central bank retained its assessment that the economy has started to
pick up moderately and is likely to return to a moderate recovery path
as demand recovers.
The members also
agreed that deflation remains a critical threat and downside risk to
the Japanese economy, as the annual rate of CPI excluding fresh food is
expected to remain around 0 percent.
"Japan's
economy faces the critical challenge of overcoming deflation and
returning to a sustainable growth path with price stability," the
minutes said. "This challenge will be met through efforts by a wide
range of economic agents to strengthen the economy's growth potential
and support from the financial side. Based on this recognition, the bank
has been providing support to strengthen the foundations for economic
growth and pursuing powerful monetary easing."
The bank noted that exports have slowed in recent months due to the slowing of other economies, but especially those in Europe.
The global economy as a whole remains fraught with ambiguity.
"There
remains a high degree of uncertainty about the global economy,
including the prospects for the European debt problem, the momentum
toward recovery for the U.S. economy, and the likelihood of emerging and
commodity-exporting economies simultaneously achieving price stability
and economic growth," the minutes said.
The
board noted that financial conditions in Japan remained accommodative.
The bank said it will continue to ensure the stability in the financial
system, while paying attention to developments in European markets.
|
|
No comments:
Post a Comment