June 27, 2012 Financial Market Summary

DJIA edged up 0.3% to end at 12,534.7. NASDAQ rose 0.6% to settle at 2,854.1. S&P 500 added 0.5% to close at 1,320.0.

Nikkei 225 index is trading flat at 8,664.2.

FTSE 100 edged down 0.1% to settle at 5,447.0.

FTSEurofirst 300 index closed marginally higher at 986.6.

In Asia, crude oil for August delivery is trading 0.2% or $0.12 higher at $79.48 per barrel.

At 0400 BST today, the GBP is trading marginally higher against the USD at $1.5637, 0.1% lower against the EUR at €1.2507, and marginally down against the JPY at ¥124.23.

US Market Snapshot

US markets ended with modest gains yesterday, as a rise in home prices for the first time in seven months in April pointed to a turnaround in the housing market, overshadowing a fall in consumer confidence for a fourth consecutive month in June. However, fears over the outcome of a key European summit continued to weigh on market sentiment. JPMorgan Chase rose 1.1%, after Goldman Sachs upgraded the stock to “Buy” on its “Americas conviction list” of highly recommended stocks. News Corp gained 8.3%, as it mulled to split into two publicly held companies. Lennar and PulteGroup gained 3.1% and 5.3%, following positive housing market data. Chevron rose 1.9%, tracking a rise in crude oil prices. Apollo Group rallied 10.3%, after its quarterly results came ahead of market expectations.

DJIA edged up 0.3% to end at 12,534.7. NASDAQ rose 0.6% to settle at 2,854.1. S&P 500 added 0.5% to close at 1,320.0.

Asian Market Snapshot

Asian markets are trading mixed this morning, as caution ahead of a key European summit on Thursday and a sharp rise in Italian and Spanish bond yields at a debt auction offset some improved US economic data and optimism that the Chinese government would ease monetary policy and increase fiscal spending to boost economic growth. In Japan, markets swung between gains and losses. Keihin Corp lost value, after Deutsche Bank downgraded the stock to “Hold”, while Oracle traded higher after the company forecasted a rise in its fiscal year earnings. In Hong Kong, Chow Tai Fook Jewellery Group gained value, after the company reported a sharp rise in its full-year earnings. In South Korea, Hyundai Motor and Kia Motors dropped sharply amid report they might possibly face a labour strike.

Nikkei 225 index is trading flat at 8,664.2. Hang Seng index is trading 1.2% higher at 19,202.2, while the Kospi index is trading 0.2% lower, at 1,814.6.

UK Market Snapshot

UK markets closed lower yesterday, after borrowing costs for the Spanish and Italian governments rose at short-term debt auctions and as US-consumer confidence declined for a fourth month in June. Royal Bank of Scotland, the top laggard on the FTSE 100 index, dropped 3.8%, while Barclays, Lloyds Banking Group and Standard Chartered slipped between 1.0% and 1.5%, following a fresh round of bank downgrades in Spain by Moody’s Investors Service. RBS also declined as technical snags in the past few days prevented customers of the bank from accessing their money. Resolution hit a record low, slipping 1.3%, after Investec issued a “Sell” note on the firm, while a downgrade by the same broker to “Hold” from “Buy” sent shares of Petrofac 0.8% lower. Serco Group dropped 1.9%, after it forecasted a small decline in organic revenue in the first half.

FTSE 100 slipped 0.1% to 5,447.0, while FTSE 250 fell 0.1% to close at 10,665.4.

European Market Snapshot

Other European markets closed mixed yesterday, as a sharp rise in Spanish borrowing costs at a debt auction and downbeat economic data in the US offset a surprise improvement in German confidence data. BMW lost 2.3%, after Citigroup downgraded the stock to “Neutral” from “Buy”, while Daimler and Fiat fell 1.0% and 2.9%, respectively. Bankia, Banco Popular Espanol and Banco de Sabadell plunged between 5.3% and 8.7%, after Moody's, late Monday, cut the credit ratings of 28 Spanish banks. Infineon tumbled 11.6%, after it lowered its third-quarter sales forecast. However, E.ON gained 3.3%, after Bank of America Merrill Lynch upgraded the stock to “Buy” from “Neutral”, while RWE advanced 2.9%, after the same broker upgraded the stock to “Neutral” from “Underperform”.

FTSEurofirst 300 index closed marginally higher to end at 986.6. German DAX Xetra 30 added 0.1% to 6,136.7. French CAC-40 closed 0.3% lower at 3,012.7.

Commodities

In Asia, crude oil for August delivery is trading 0.2% or $0.12 higher at $79.48 per barrel. Yesterday, crude oil for August delivery advanced 0.2% or 15 cents to settle at $79.36 per barrel, as prospect of a decline in US crude oil inventories and reports that showed house prices in the US fell less-than-expected, overshadowed concern about a weakening economic outlook. Additionally, EU governments on Monday formally approved an embargo on Iranian oil to start on July 1.

Gold for immediate delivery is trading 0.1% higher today, at $1,573.57 per ounce. Gold for August delivery lost 0.9% or $13.50 to $1,574.90 per ounce yesterday, as some weak economic data in the US pushed the dollar higher, and as investors cautiously await the outcome of a key European Union summit due later this week.

Currencies

At 0400 BST today, the GBP is trading marginally higher against the USD at $1.5637, 0.1% lower against the EUR at €1.2507, and marginally down against the JPY at ¥124.23.

The EUR is trading 0.2% higher against the USD at $1.2504. Earlier, the currency was trading lower against the USD, ahead of an Italian debt auction. Italy would auction €9.0 billion of 185-day bills today, followed by sales of five- and 10-year bonds tomorrow amounting to €5.5 billion.

The EUR is trading 0.1% higher against the JPY at ¥99.34.

The JPY is trading higher against most of its major peers, ahead of a meeting between German Chancellor, Angela Merkel, and French President, Francois Hollande, later today, amid mounting speculation that the EU summit starting tomorrow would fail to introduce new measures to stem debt crisis.

The USD is trading lower against the JPY, ahead of a data due to be released this week that might show US consumer spending stalled in May.

Yesterday, the EUR closed lower against most of its peers, following a rise in Spanish and Italian bond yields, and after Moody’s Investors Service downgraded 28 Spanish banks.

The USD ended lower against the JPY, after a report showed that US consumer confidence fell for a fourth month in June to a five-month low.