Stocks Seeing Modest Weakness Despite Upbeat Data
With traders shrugging off a batch of largely upbeat U.S. economic
data, stocks have moved moderately lower during trading on Tuesday. The
major averages have slipped into negative territory, although selling
pressure has remained relatively subdued.
The modest weakness on Wall Street comes
as traders express continued uncertainty about whether lawmakers in
Washington will be able to put aside their differences and reach an
agreement to avoid the fiscal cliff looming at the end of the year.
The
worries about the fiscal cliff have offset upbeat reports on U.S.
durable goods orders, home prices, and consumer confidence as well as
news of another round of bailout financing for Greece.
Electronic
storage stocks have shown a notable move to the downside, dragging the
NYSE Arca Disk Drive Index down by 1.2 percent. Seagate Technology and
Western Digital are turning in two of the sector's worst performances.
Gold,
commercial real estate and telecom stocks are also seeing some weakness
on the day, although most of the major sectors are showing only modest
moves.
The major averages have recently climbed off their lows for the session but remain in the red. The Dow is down 36.16 points or 0.3 percent at 12,931.21, the Nasdaq is down 5.08 points or 0.2 percent at 2,971.70 and the S&P 500 is down 2.95 points or 0.2 percent at 1,403.34.
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TSX Extends Losses As Commodities Struggle - Canadian Commentary
Canadian stocks were lingering in the red Tuesday morning as commodities were struggling to move higher even after euro zone officials and the International Monetary Fund agreed to provide more funding for debt-stricken Greece.
The
complex deal reached late Monday will enable Athens to receive $40.8
billion immediately and three additional payments in early 2013.
Meanwhile,
Mark Carney, currently head of Canada's central bank, was appointed
Monday as the new Governor of the Bank of England. He will succeed
Mervyn King, who steps down next June.
The S&P/TSX Composite Index shed 27.54 points or 0.23 percent to 12,157.51, a day after snapping its six-session winning streak.
The Diversified Materials Index was down nearly 1 percent, with First Quantum Minerals losing about 3 percent. Inmet Mining slipped nearly 050 percent, while Teck Resources was adding about 0.50 percent.
The price of gold was ticking lower Tuesday morning as traders now shifted their focus to US fiscal cliff, with the US dollar trading steady versus a basket of currencies. gold for December eased $4.40 to $1,745.20 an ounce.
Among gold plays, Allied Nevada gold and Goldcorp. were down over 1 percent each.
Gold
miner Osisko Mining Corp. lost close to 3 percent after it said it
would acquire 7.80 million common shares of Queenston Mining Inc.
(QMI.TO) from Agnico-Eagle Mines ( AEM.TO). Agnico-Eagle and Queenston were down over 1 percent each.
The price of Crude oil was moving lower Tuesday morning even after euro zone ministers and the International Monetary Fund reached an agreement to help reduce Greece's debt. Crude for January edged down $0.60 to $87.14 a barrel.
In the oil patch, Nexen Inc. and Tourmaline Oil surrendered nearly 2 percent each.
BlackBerry maker Research In Motion was down about 6 percent on profit taking as the stock rose over 20 percent in the past few sessions.
Meanwhile, Bombardier Aerospace
(BBD_A.TO, BBD_B.TO) soared 8 percent after it said it got firm orders
for 56 Global jets and options for a further 86 Global jets at a 2012
U.S. list price value of over $7.8 billion from VistaJet, a
world-leading luxury aviation company and exclusive operator of Bombardier business aircraft.
Frozen seafood supplier High Liner Foods Incorporated
(HLF.TO) surged over 8 percent after announcing that it has completed
the final stages of the Icelandic USA integration, well ahead of
schedule and less than a year after the acquisition of Icelandic Group's
U.S. assets.
In economic news from the U.S., the Commerce
Department said that durable goods orders edged up by less than a tenth
of a percent in October after surging up by a revised 9.2 percent in
September. Economists had been expecting orders to decrease by about 0.8
percent. Excluding a 3.1 percent drop in orders in the volatile
transportation sector, durable goods orders rose by 1.5 percent in
October following a 1.7 percent increase in the previous month.
Separately,
Standard & Poor's said S&P/Case-Shiller 20-City Composite Home
Price Index saw a 3.0 percent annual increase in September compared to
the 2.0 percent year-over-year growth seen in August. Economists had
expected prices to increase by about 2.9 percent. S&P also said the
20-City Composite Home Price Index increased by a seasonally adjusted
0.4 percent on a monthly basis in September following a matching
increase in August.
From Europe, the U.K. economy expanded 1
percent sequentially in the third quarter as previously estimated,
ending three straight quarters of contraction, second estimate published
by the Office for National Statistics showed. The third quarter growth
follows a 0.4 percent decline in the second quarter and a 0.3 percent
drop in the first quarter of 2012.
Meanwhile, a report from the
Federal Statistical Office revealed that Germany's import price
inflation slowed to 1.5 percent annually in October.. Economists had
forecast the annual rate to remain unchanged at 1.8 percent.
Month-on-month, import prices were down 0.6 percent, compared to a 0.7
percent drop a month ago. It was forecast to ease just 0.3 percent in
October.
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European Markets Higher After Greek Deal, Banks Gain
The European markets are higher on Tuesday after the Eurozone and the
International Monetary Fund reached agreement on a new bailout program
for debt-stricken Greece. Banks were notably higher on the day.
The EU and IMF said Greece's sovereign long-term debt would be reduced by 40 billion euros or 124 percent of gross domestic product by the year 2020. The agreement came late Monday at the end of almost 10 hours of negotiations.
International
Monetary Fund Chief Christine Lagarde said the Fund would release its
share of Greek loan payments after Eurozone delivers on its commitments
made at the latest Eurogroup meeting on Monday. Carney's five-year term
at the helm of the central bank will start on July 1, 2013.
Meanwhile,
Mark Carney, currently head of Canada's central bank, was appointed
Monday as the new Governor of the Bank of England. He will succeed
Mervyn King, who steps down next June.
Carney currently serves as
Chairman of the Financial Stability Board and as a member of the Board
of Directors of the Bank for International Settlements (BIS). He is also
a member of the Group of Thirty, and of the Foundation Board of the
World Economic Forum.
Data published by the Office for National
Statistics showed that the U.K. economy expanded 1 percent sequentially
in the third quarter as previously estimated, ending three straight
quarters of contraction.
Sentiment among French consumers remained
unchanged in November, the latest report from statistical office Insee
showed Tuesday.
The euro Stoxx 50 index of eurozone bluechip stocks is adding 0.33 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, is gaining 0.34 percent.
The German DAX is gaining 0.5 percent and the French CAC 40 is advancing 0.2 percent. The FTSE 100 in the U.K. is gaining 0.4 percent and Switzerland's SMI is adding 0.5 percent.
In Frankfurt, Commerzbank is adding 3.9 percent and Deutsche Bank is rising 2.8 percent.
ThyssenKrupp is up 0.6 percent even after UBS added the stock to ''Least Preferred List in European Mining.''
UBS also added Kloeckner to ''Least Preferred List in European Mining.'' But the stock is climbing 1.6 percent.
Deutsche Wohnen is climbing 2.4 percent, following a broker upgrade.
Real estate developer GSW Immobilien is advancing 3.2 percent. Morgan Stanley raised the stock to ''Overweight.''
Sky Deutschland is declining 2.3 percent. Deutsche Bank re-initiated the stock with a ''Hold'' rating.
In Paris, Societe Generale, Credit Agricole and BNP Paribas are gaining between 2.9 percent and 1.5 percent.
Carrefour is gaining over 1 percent after a report said the retailer plans to open new hypermarkets in China in 2013.
Drinks
company Rémy Cointreau reported a surge in profit for the first half of
the year, driven by growth in Asia and the U.S. The company also backed
its full year outlook of substantially higher earnings. The stock is
climbing 6.4 percent.
In London, Royal Bank of Scotland is adding 3.6 percent and Lloyds Banking is advancing 2.3 percent.
Standard Life is gaining 1.9 percent. The insurer announced a subordinated debt issuance raising 500 million pounds.
Pub and restaurant operator Mitchells & Butlers reported a Sharp drop in profit for the year, weighed down by items. The stock is losing 5 percent.
De
La Rue is dropping 2 percent. The banknote printer said it has
experienced delays in a number of significant orders, but the board
remains confident that the orders will be received for shipment in
fiscal 2013/14.
Galp Energia is losing close to 5 percent in
Lisbon. Italian oil and gas company Eni said it would further sell its
stake in the Portuguese energy firm.
Across Asia/Pacific, markets had a mixed outing. Australia's All Ordinaries gained 0.7 percent and Japan's Nikkei 225 rose 0.4 percent. However, China's Shanghai Composite Index retreated 1.3 percent and Hong Kong's Hang Seng fell marginally.
In
the U.S., futures point to a higher open on Wall Street. In the
previous session, stocks closed mixed after initially showing a notable
move to the downside. The tech-heavy Nasdaq was up 0.3 percent, closing higher for the sixth consecutive session. Meanwhile, the Dow fell 0.3 percent and the S&P 500 dipped 0.2 percent.
In the commodity space, Crude for January delivery is adding $0.04 to $87.82 per barrel while December gold is losing $3.0 to $1746.6 a troy ounce.
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Asian Markets Mostly Higher On Renewed Optimism About Greece
Asian stock markets are mostly up in positive territory on Tuesday with
investors picking up stocks following the eurozone finance ministers
and the International Monetary Fund reaching a deal on a new debt target
for Greece.
However, gains are just modest in most of the markets
in the region with a section of traders treading cautiously at higher
levels, choosing to wait for more clear signals to emerge.
According
to reports, eurozone finance ministers have struck a new deal with the
IMF to slice more than 40 billion euros or A$50 billion off Greece's
massive debt burden by 2020. This will bring down Greece's debt-to-GDP
ratio from an estimated 144 percent to 124 percent, by the year 2020.
Healthcare
stocks are among the most impressive gainers in the Australian market.
Financial, mining, consumer discretionary and telecommunications stocks
are also trading firm, while energy and industrial stocks are mixed.
The benchmark S&P/ASX 200 index,
which advanced to 4,461.7, is currently trading at 4,456, up 31.8
points or 0.7 percent from its previous close. The broader All Ordinaries index is up 29.2 points or 0.7 percent at 4,472.7.
Among bank stocks, ANZ Bank , Westpac and National Australia Bank are up 0.7 to 1 percent, while Commonwealth Bank of Australia is trading marginally higher. Bendigo & Adelaide Bank and Bank of Queensland are trading weak.
Among top miners, BHP Billiton (BHP, BBL), Rio Tinto (RIO, RIO.L) and Fortescue Metals are up 1 to 1.4 percent, while Newcrest Mining is up marginally.
In the energy sector, Woodside Petroleum, Origin Energy and Caltex Australia are up 0.3 to 0.7 percent, while Santos and Oil Search are trading weak.
Shares
of blood products and vaccine supplier CSL Limited are up more than 7
percent following the company lifting its profit guidance for the
financial year due to the performance of its U.S.-based subsidiary CSL
Behring. The company expects its profit after tax in the 2012-2013
financial year to grow by about 20 percent. In August, CSL forecast
profit growth of about 12 percent.
Iluka Resources is up nearly 7 percent. Lynas Corporation and Arrium are trading higher by 6 percent and 4.2 percent, respectively. Boart Longyear, Fairfax Media, Aristocrat Leisure, ALS and Bluescope Steel are up 3 to 4 percent.
Tatts
Group is adding 2.3 percent following the company securing the right to
operate South Australia's lottery and Keno services for the next 40
years.
Ramsay Healthcare, Challenger, Qantas Airways, Beach Energy, Crown, James Hardie Industries, QBE Insurance Group and Alumina are also trading sharply higher.
Treasury Wine Estates and Paladin Energy are down in negative territory, losing 2.2 percent and 2 percent, respectively.
After a weak start following the yen's rise against the euro and
the U.S. dollar, the Japanese market rebounded smartly with investors
picking up stocks, amid reports that the eurozone finance ministers and
the International Monetary Fund have reached a deal on cutting down
Greece's debt burden.
Bank, pharmaceuticals, railway and pulp
& paper moved higher. Electric power stocks declined after the
previous session's strong gains. Automobile and steel stocks opened on a
weak note, but came off their lows subsequently.
The benchmark Nikkei 225
index, which drifted down to 9,370.6 in early trades, rose to 9,448.6
subsequently and was up 36 points or 0.4 percent at 9,424 at the end of
the morning session.
Fukuoka Financial Group Inc. shares gained 5
percent. Toyobo Co., Shinsei Bank, Shionogi, Nisshinbo Holdings, Kansai
Electric Power, Unitika, Chiba Bank, NTN Corp., Japan Tobacco and
Central Japan Railway all moved up 2 to 4 percent.
Fast Retailing, Oji Holdings Corp., Yahoo Japan,
Nippon Yusen KK, East Japan Railway, Sumitomo Mitsui Trust Holdings,
Astellas Pharma, Tokyo Electric Power, West Japan Railway, Shizuoka
Bank, Bank of Yokohama and Mizuho Financial Group also posted strong gains.
Meanwhile, JFE Holdings, Nippon Sheet Glass, IHI Corp., Mitsubishi Electric
Corp., Nissan Motor, Advantest Corp. , Mazda Motor, Nisshin Steel
Holdings and Yaskawa Electric traded weak, losing 1 to 3 percent.
In
economic news, an index measuring corporate service prices was down 0.7
percent on year in October at 95.5, according to a report from the Bank
of Japan. That missed forecasts for a decline of 0.6 percent on year
following the 0.5 percent fall in September.
On a monthly basis,
corporate service prices were down 0.1 percent following the flat
reading in the previous month. By category, prices were down for
advertising services and communications. Transportation prices were up
by air but down by sea.
In the currency market, the U.S. dollar traded in the upper 81 yen range in early deals in Tokyo. The yen is currently trading at 81.98 to the dollar.
Among
other markets in the Asia-Pacific region, Hong Kong, Indonesia,
Singapore and South Korea are trading higher. Indonesia, Taiwan and New
Zealand are up marginally, while Shanghai and Malaysia are down with
notable losses.
On Wall Street, stocks ended on a mixed note
Monday, after exhibiting weakness early on in the session due to worries
about the looming fiscal cliff. While the Nasdaq managed to climb into positive territory, the Dow and the S&P 500 remained stuck in the red.
The Nasdaq ended up 9.9 points or 0.3 percent at 2,976.8, while, the Dow declined 42.3 points or 0.3 percent to 12,967.4 and the S&P 500 dipped 2.9 points or 0.2 percent to 1,406.3.
Major European markets drifted lower on Monday. The German DAX index dipped by 0.2 percent, while the U.K.'s FTSE 100 index and the French CAC 40 Index lost 0.6 percent and 0.8 percent, respectively.
U.S. Crude oil snapped
a two-day gain to settle lower on Monday, tracking declining global
equity markets while awaiting cues from the eurozone finance ministers
meeting in Brussels, even as the dollar strengthened against most major currencies.
Crude
for January delivery ended down $0.54 or 0.6 percent at $87.74 a barrel
on the New York Mercantile Exchange, after scaling an intra-day high of
$88.29 a barrel.
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Crude Edges Up On Euro Zone Hopes
The price of Crude oil was moving higher Tuesday morning after euro zone ministers and the International Monetary Fund reached an agreement to help reduce Greece's debt.
Light Sweet Crude oil
futures for January delivery, edged up $0.14 to $87.88 a barrel.
Yesterday, oil settled lower tracking declining global equity markets
while awaiting cues from the euro zone finance ministers meeting in Brussels, even as the dollar strengthened against most major currencies.
This morning, the U.S. dollar was lingering around its 3-week low versus the euro and sterling. The buck continued to level off from its 7-month high versus the yen and ticking higher against the Swiss franc.
In
economic news from Europe, the U.K. economy expanded 1 percent
sequentially in the third quarter as previously estimated, ending three
straight quarters of contraction, second estimate published by the
Office for National Statistics showed. The third quarter growth follows a
0.4 percent decline in the second quarter and a 0.3 percent drop in the
first quarter of 2012.
Meanwhile, a report from the Federal
Statistical Office revealed that Germany's import price inflation slowed
to 1.5 percent annually in October.. Economists had forecast the annual
rate to remain unchanged at 1.8 percent. Month-on-month, import prices
were down 0.6 percent, compared to a 0.7 percent drop a month ago. It
was forecast to ease just 0.3 percent in October.
Traders will
look to the durable goods orders report for October from the US Commerce
Department, due out at 8:30 am ET. Economists expect durable goods
orders to decline by 0.8 percent from the previous month, while
excluding transportation orders are expected to dip by a more modest 0.4
percent.
The results of the S&P/Case-Shiller house
price survey will be released at 9 am ET. The 20-city composite house
price index is expected to have increased by 0.4 percent on a seasonally
adjusted basis in September. The unadjusted index is also likely to
have risen by 0.4 percent.
Federal Reserve Chairman Ben Bernanke
is due to deliver brief welcoming remarks at the National College Fed
Challenge Finals, in Washington at 8:30 am ET.
Today after the market hours, the API will release its US Crude oil inventories report for the weekended November 23. |
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