Friday, 20 July 2012

July 20, 2012 Financial Market Summary

DJIA edged up 0.3% to settle at 12,943.4. NASDAQ gained 0.8% to close at 2,965.9. S&P 500 ticked up 0.3% to end at 1,376.5.
Nikkei 225 index is trading 0.3% lower at 8,770.3.
FTSE 100 added 0.5%, to settle at 5,714.2.
FTSEurofirst 300 index closed 1.0% higher at 1,064.5.
In Asia, crude oil for August delivery is trading 0.7% or $0.60 lower at $92.06 per barrel.
At 0400 BST today, the GBP is trading marginally lower against the USD at $1.5714, slightly lower against the EUR at €1.2797, and 0.2% lower against the JPY at ¥123.48.
US Market Snapshot
US markets rose yesterday for the third straight day, with the S&P 500 index closing to a two month high, as better-than-expected corporate earnings and expectation for a fresh near-term stimulus in the wake of disappointing economic data boosted market sentiment. IBM rallied 3.8%, as it boosted its full-year earnings target. eBay gained 8.6%, as it more than doubled its second-quarter net income. Qualcomm rallied 4.3%, as it stated that it was on track to resolve the supply issues, which would help it to log a strong final quarter in 2012. Walgreen soared 11.8%, after resolving a long-running dispute with Express Scripts.  Express Scripts added 1.9%. Capital One Financial climbed 2.7%, as its core second-quarter earnings surpassed market expectations.
DJIA edged up 0.3% to settle at 12,943.4. NASDAQ gained 0.8% to close at 2,965.9. S&P 500 ticked up 0.3% to end at 1,376.5.
Asian Market Snapshot
Asian markets are trading mostly higher this morning, as strong US corporate earnings overshadowed dismal economic reports in the US and amid speculation China would not relax property control policies. In Japan, steel-makers, JFE Holdings, Nippon Steel and Kobe Steel traded lower, after a key iron-price gauge dropped to its lowest level in eight months as weak sentiment and ample inventories dampened demand from Chinese steelmakers. In Hong Kong, China Unicom Hong Kong paced gains after reporting strong 3G subscriber additions in June. Cnooc and China Petroleum & Chemical traded higher after crude oil prices firmed overnight. In South Korea, SK Hynix paced gains, aided by bargain hunting from investors, while LG Electronics traded higher as its US-technology peers posted solid gains overnight.
Nikkei 225 index is trading 0.3% lower at 8,770.3. Hang Seng index is trading 0.2% higher at 19,597.0. Kospi index is trading 0.3% higher at 1,828.6.
UK Market Snapshot
UK markets closed higher yesterday, with the FTSE 100 index inching to its highest closing level in over two months, as a stream of robust earnings reports from companies across the US and Europe boosted sentiment. Burberry jumped 4.6%, after its French peer Hermes reported a double-digit rise in its second quarter sales. Rio Tinto climbed 1.7%, after the company mulled to cut jobs in Australia in an effort to reduce costs. Amongst other mining stocks, ENRC, Antofagasta and BHP Billiton rose between 1.4% and 1.6%, respectively, tracking a rise in base metal prices. Afren rallied 7.7%, after it discovered more oil at its Simrit-2 exploration well in Iraq. Lloyds Banking Group advanced, 1.5%, after it agreed to sell 632 branches for £350 million. London Stock Exchange added 2.1%, on an upbeat trading statement and amid speculation about a bid from Singapore Stock Exchange.
FTSE 100 added 0.5%, to settle at 5,714.2. FTSE 250 advanced 1.4 %, to close at 11,242.5.
European Market Snapshot
Other European markets closed higher yesterday, as upbeat quarterly earnings reports from several companies and approval by the German lawmakers for Spain's bank bailout overshadowed disappointing UK retail sales data and concern over rising Spanish borrowing cost at an auction. Nokia surged 12.0%, after sales of its flagship smartphone dropped but less than analyst estimates. Apparel manufacturer, Hermes International rose 3.1%, after the company’s second-quarter sales surpassed market expectations. Novartis gained 1.7%, after the company reported less-than-expected drop in its second-quarter earnings. Akzo Nobel soared 6.3%, after the company’s second-quarter results came in better-than-expected.
FTSEurofirst 300 index closed 1.0% higher at 1,064.5. German DAX Xetra 30 rose 1.1% to 6,758.4. French CAC-40 closed 0.9% higher at 3,263.6.
Commodities
In Asia, crude oil for August delivery is trading 0.7% or $0.60 lower at $92.06 per barrel. Yesterday, crude oil for August delivery advanced 3.1% or $2.79 to $92.66 per barrel, as worries about supply disruption increased following rising tensions in the Middle East between Iran and Israel, and in Syria. Oil prices also rose, tracking a rise in equity markets and on increased expectation of further monetary easing by the US following weak economic data.
Gold for immediate delivery is trading 0.1% lower today, at $1,582.55 per ounce. Gold for August delivery settled up 0.6% or $9.60 at $1,580.40 per ounce yesterday, as the dollar traded lower against its peers and as dismal US economic data raised hopes for additional economic stimulus from the US Federal Reserve, boosting the demand for the precious metal as a hedge against inflation.
Currencies
At 0400 BST today, the GBP is trading marginally lower against the USD at $1.5714, slightly lower against the EUR at €1.2797, and 0.2% lower against the JPY at ¥123.48.
The EUR is trading slightly higher against the USD at $1.2278.
The EUR is trading 0.2% lower against the JPY at ¥96.49, ahead of economic reports due in next week which are expected to show that eurozone consumer confidence remained weak and manufacturing activity in the region slowed in July.
The AUD and NZD are trading higher against the USD, tracking higher commodity prices and amid improved speculation of more monetary stimulus from the US Federal Reserve.
Yesterday, the USD ended lower against its peers, as disappointing US jobless claims and Philadelphia manufacturing data increased speculation that Federal Reserve would implement further monetary easing to support the economy. The EUR ended higher against the USD, tracking a rise in equity markets after the German parliament approved a rescue package worth up to €100 billion ($122 billion) to help ailing Spanish banks. However, earlier in the session the EUR was trading lower, following a weak Spanish debt auction. The GBP ended higher against the EUR, as escalating worries over euro-zone debt crisis boosted demand for the relatively safe UK currency. The CAD ended higher against the USD, following upbeat wholesale sales data for May and as higher commodity prices increased the demand for the commodity linked currency.

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