Stocks: Thursday's review
Japan's market was closed for a holiday.
European stocks fell for a third day as bank earnings disappointed, commodities plunged and a jump in U.S. jobless-benefit claims fueled concern that the recovery of the world’s largest economy may falter.
Lloyds Banking Group Plc (LLOY) slumped the most in almost a year after reporting a quarterly loss. Societe Generale SA, France’s second-largest bank by market value, dropped 5 percent as profit missed analyst estimates. Fresnillo Plc (FRES), the world’s biggest primary silver producer, and Essar Energy Plc (ESSR) sank more than 4 percent as the Standard & Poor’s GSCI Index of 24 raw materials tumbled the most in almost two years.
Factory orders in Germany, Europe’s largest economy, unexpectedly dropped in March, led by a slump in demand for investment goods at home and abroad. Orders, adjusted for seasonal swings and inflation, slid 4 percent from February, the Economy Ministry in Berlin said.
European stocks pared their decline as European Central Bank President Jean-Claude Trichet said inflation risks will be watched “very closely,” signaling the ECB may wait until after June to raise interest rates again. The ECB and the Bank of England both kept their benchmark rates unchanged today, as forecast by all economists
U.S. stocks fell, sending the Standard & Poor’s 500 Index lower for a fourth straight day, as a report showed that more Americans unexpectedly filed first-time claims for unemployment insurance and commodities slumped.
Exxon Mobil Corp. (XOM) and Chevron Corp. (CVX) dropped at least 1.4 percent as oil retreated. General Motors Co. (GM) slumped 3.8 percent after saying that Chinese sales declined. The NYSE Arca Airline Index rose 1.5 percent as crude extended its loss since April 29 to 8.2 percent, boosting optimism carriers’ costs will fall.
More Americans unexpectedly filed first-time claims for unemployment insurance payments last week, pushed up by three factors that normal seasonal variations failed to take into account, the Labor Department said.
Applications for jobless benefits jumped by 43,000 to 474,000 in the week ended April 30, the most since August, Labor Department figures showed today. A spring break holiday in New York, a new emergency benefits program in Oregon and auto shutdowns caused by the disaster in Japan were the main reasons for the surge, a Labor Department spokesman said as the data was released to the press.