May 24, 2012 Financial Market Summary

DJIA edged down 0.1% to close at 12,496.2. NASDAQ advanced 0.4% to settle at 2,850.1. S&P 500 edged up 0.2% to end at 1,318.9.

Nikkei 225 index is trading 0.3% lower at 8,532.1.

FTSE 100 tumbled 2.5% to settle at 5,266.4

FTSEurofirst 300 index fell 2.2% to 972.0.

In Asia, crude oil for July delivery is trading 0.7% or 59 cents higher at $90.49 per barrel.

At 0400 BST today, the GBP is trading marginally higher against the USD at $1.5687, 0.1% lower against the EUR at €1.2475, 0.1% higher against the JPY at ¥124.75.

US Market Snapshot

US markets closed mostly higher yesterday, recouping earlier losses, as a better-than-expected reading on new home sales for April and optimism over probable concrete actions by European leaders to arrest the debt crisis boosted market sentiment. However, the gains were capped as investors remained on edge about Greece’s possible exit from the Eurozone. Homebuilder, Toll Brothers gained 2.7%, as it posted upbeat earnings for the second quarter, while retailer, Guess jumped 6.5%, as its quarterly profit beat market expectations. Ford added 2.2%, as it was raised to “Investment grade” by Moody’s Investors Service, enabling the company to reclaim its Blue Oval insignia and other assets it mortgaged in 2006 as collateral for a loan to fund its turnaround plan. However, Dell plunged 17.2% and led the technology sector lower, as it missed earnings forecasts for its first quarter.

DJIA declined marginally by 0.1% to close at 12,496.2. NASDAQ advanced 0.4% to settle at 2,850.1. S&P 500 edged up 0.2% to end at 1,318.9.

Asian Market Snapshot

Asian markets are trading mostly lower this morning, amid speculation that European leaders might fail to decide measures to resolve the Eurozone debt crisis, and following a survey that showed China’s manufacturing activity would contract for a seventh month in May. In Japan, energy sector stocks, Inpex and Japan Petroleum Exploration traded lower, tracking overnight losses in crude oil prices. Exporters, Canon, Nissan Motor and Mazda Motor paced lower, as the yen appreciated against the dollar yesterday. In Hong Kong, banking stocks, China Construction Bank, HSBC Holdings and The Bank of East Asia traded lower, as risk aversion increased among investors. In South Korea, exporters, Kia Motors, LG Electronics and SK Hynix paced higher, reversing their earlier session losses.

Nikkei 225 index is trading 0.3% lower at 8,532.1. Hang Seng index is trading 0.4% lower at 18,705.0, while the Kospi index is trading 0.3% higher, at 1,813.7.

UK Market Snapshot

UK markets dropped sharply yesterday, amid heightened concerns about Greece’s probable exit from the Euro-bloc, ahead of an EU summit, and after UK retail sales fell at their fastest monthly pace in more than two years in April. Vedanta Resources, the top laggard on the FTSE 100 index, slumped 9.1%, while other miners such as Xstrata, Glencore International, Rio Tinto, Polymetal International and Kazakhmys tumbled between 4.8% and 7.9%, as base metal prices lost ground on fears of slowing growth in China and Eurozone risks. Tullow Oil declined 5.0%, tracking a slump in oil prices. Retailers, Next, Tesco and Marks & Spencer declined between 1.5% and 1.9%, as weak UK retail sales data for April revealed a sharper-than-expected drop in clothing sales. Barclays declined 4.5%, amid speculation that it would restructure its operations or sell some of its branches in Italy.

FTSE 100 tumbled 2.5% to settle at 5,266.4, while FTSE 250 slumped 1.9% to 10,375.7.

European Market Snapshot

Other European markets closed sharply lower yesterday, led by losses in banking and energy sector stocks, amid mounting concerns that Greece might leave the euro bloc, and after Japan’s exports rose less-than- estimated in April on an yearly basis. Financial sector stocks, Deutsche Bank, Credit Agricole and Intesa Sanpaolo, lost between 2.1% and 6.3%, as risk appetite decreased among investors. ThyssenKrupp sank 4.3%, after Fitch Ratings trimmed its outlook on the stocks to “Negative” from “Stable”. Deutsche Boerse lost 3.9%, amid speculation that it might be removed from the Euro Stoxx 50 Index next week. Energy stock, Total, declined 1.9%, in line with a fall in crude oil prices.

FTSEurofirst 300 index fell 2.2% to 972.0. German DAX Xetra 30 lost 2.3% to 6,285.8. French CAC-40 closed 2.6% lower, at 3,003.3.

Commodities

In Asia, crude oil for July delivery is trading 0.7% or 59 cents higher at $90.49 per barrel. Yesterday, crude oil for July delivery fell 2.1%, or $1.95, to settle at $89.90 per barrel, as the dollar closed higher against the euro, decreasing the demand for alternative investments such as commodities. Crude oil also lost value, as supply concerns eased, on hopes of a deal between Iran and the International Atomic Energy Agency, and after US crude oil inventories increased by 883,000 barrels to 382.5 million barrels, a 22-year high, for the week ended 18 May.

Gold for immediate delivery is trading 0.2% higher today, at $1561.60 per ounce. Gold for June delivery sank 1.8% or $28.20 to $1,548.40 per ounce yesterday, as the dollar strengthened against the euro, decreasing the demand for the precious metal as a hedge against the inflation.

Currencies

At 0400 BST today, the GBP is trading marginally higher against the USD at $1.5687, 0.1% lower against the EUR at €1.2475, 0.1% higher against the JPY at ¥124.75.

The EUR is trading 0.1% higher against the USD at $1.2575. The currency is trading 0.2% higher against the JPY at ¥100.01. Earlier, the currency was trading lower, as German Chancellor, Angela Merkel, reiterated opposition to jointly issued common Euro bonds raising concerns that the debt crisis could worsen.

The NZD is trading higher against the USD, after New Zealand’s exports exceeded imports by NZ$355 million, from a revised NZ$186 million in March.

Yesterday, the EUR ended lower against the USD, amid speculation that a summit of European Union leaders would fail to issue new measures to prevent the spread of the European sovereign-debt crisis.

The JPY closed higher against most of its major peers, after the Bank of Japan left its asset-purchase fund unchanged at ¥40 trillion.

The AUD and CAD ended lower against the USD and the JPY, as lower commodity prices decreased the demand for the commodity linked currencies.

The GBP finished higher against the EUR, after minutes of the Bank of England’s May monetary-policy meeting showed that eight members voted to keep the central bank’s bond-buying programme on hold, while just one voted in favour of more QE.