US Market starts week with losses
US Market ended the day with losses today, Monday, 14 April, 2008 after financial sector weighed on investor sentiments. Traders found it hard to digest Wachovia Securities losses as they continued to grapple under General Electrics dismal results. Overall, only three sectors finished in positive territory. Energy staged the largest advance.
Dow was up by as much as 30 points earlier during the day. But it traded in the red in the second half. At the end, The Dow Jones industrial Average ended with a loss of 23.3 points at 12,302. The Nasdaq Composite Index, finished lower by 14 points at 2,275. S&P 500 finished lower by 4.5 points at 1,328. Seventeen one out of thirty Dow stocks ended in the red today.
The financial stocks like American Express, AIG, Citigroup were the main Dow laggards today after the stocks dropped by more than 3% each.
Wachovia Securities was the focal point in the financial sector today. The stock declined 9% today after the company reported a first quarter loss as against an expected profit. The company announced that the bank cut its dividend sharply to preserve capital and also announced concurrent common and convertible preferred stock offerings that raised $7 billion in aggregate.
The Department of Commerce reported today that retail sales rose 0.2% in March and 0.1%, excluding autos. That was fairly close to expectations, but the realization that gasoline station sales were a key driver behind the rise did not give much to traders to cheer.
Among other economic data of the day, U.S. business inventories rose 0.6% in February from a revised 0.9% increase in January.
Financials led the decline today followed by IT and consumer discretionery.
Among major deal news for the day, Blockbuster said it offered between $6 and $8 per share in cash to acquire Circuit City (on 17 February. Both companies have seen their stock values dwindle the last few years due to increased competition.
Johnson and Johnson to set tomorrows trading tone
Crude prices rose today, as the dollar fell against the euro. Stronger than expected retail data took crude prices more than $1.5 today during intra day trading but at the end, it ended modestly higher. Crude-oil futures for light sweet crude for May delivery closed at $111.76/barrel (higher by $1.62/barrel or 1.5%) on the New York Mercantile Exchange. During intra day trading, oil touched $111.99, the second-highest intraday price.
In the currency market today, the dollar pared losses but remained lower against most major counterparts on fears about the state of the U.S. economy, as better-than-forecast retail sales data failed to stem worries about the greenback. The dollar index, which tracks the performance of the greenback against a basket of other major currencies, edged down 0.2% to 71.76. Wachovias disappointing earning reports fuelled worries that credit crisis is far from being over.
Volume on the New York Stock Exchange topped 1.2 billion, with declining stocks outpacing advancers more than 4 to 3. On the Nasdaq, 565 million shares traded hands, and declining stocks bested those advancing 3 to 2.
Tomorrow, Johnson & Johnson is scheduled to release their latest earnings results prior to the stock market's open. Among economic reports, the Producer Price Index for March is due together with the Empire State Manufacturing Survey is due simultaneously.
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