Stocks: Thursday’s review
Asian stocks rose, with the regional benchmark index heading for its biggest three-day gain since December 2009, as German lawmakers will vote to expand a bailout fund for Europe’s debt-stricken nations.
Nikkei 225 8,701 +85.58 +0.99%, Hang Seng Closed, S&P/ASX 4,008 -31.22 -0.77%, Shanghai Composite 2,365 -26.72 -1.12%
Mitsubishi UFJ Financial Group Inc. (8306), Japan’s largest lender, gained 2.3 percent in Tokyo on optimism the German vote will ease concerns about the global financial system. Canon Inc. (7751), the world’s biggest camera maker, gained 1.6 percent after orders for U.S. capital goods unexpectedly climbed. BHP Billiton Ltd. (BHP), the world’s No. 1 mining company, fell 1.4 percent in Sydney after copper futures extended declines.
European stocks climbed for the fourth time in five days as U.S. employment and growth data exceeded forecasts and German lawmakers backed an enhanced euro- region rescue fund.
The Stoxx Europe 600 Index climbed 0.7 percent to 228.9 at 4:43 p.m. in London after swinging between gains and losses at least 15 times. The measure is heading for its worst quarter since 2008, having fallen 16 percent amid concern global economic growth is slowing and policy makers are struggling to contain the European debt crisis. The gauge has dropped 3.6 percent this month following a 10 percent slump in August.
National benchmark indexes climbed in 16 of the 18 western European markets. Germany’s DAX and France’s CAC 40 advanced 1.1 percent. The U.K.’s FTSE 100 declined 0.4 percent as mining companies fell.
FTSE 100 5,197 -20.79 -0.40%, CAC 40 3,028 +32.03 +1.07%, DAX 5,640 +61.16 +1.10%.
BNP Paribas SA and UBS AG (UBSN) led gains in banking shares, rallying more than 3 percent. Hennes & Mauritz AB (HMB) surged 6.8 percent after Europe’s second-largest clothing retailer reported earnings that beat estimates. Swatch slumped 5.8 percent to 325 Swiss francs. Burberry Group Plc (BRBY) declined 8.3 percent to 1,201 pence. Luxury-goods makers fell as the Bloomberg survey showed most global investors predict Chinese growth will slow to less than half the pace sustained since the government began dismantling Mao Zedong’s communist economy three decades ago.
Mining companies retreated with base metals. Fresnillo Pc, the world’s largest primary silver producer, slid 4.7 percent to 1,511 pence. Rio Tinto Group, the second-biggest mining company, lost 3.1 percent to 2,962 pence.
U.S. stocks rose, rebounding from an earlier loss, as lower-than-estimated claims for unemployment benefits and a vote by German lawmakers to expand a European bailout fund helped offset losses by technology and consumer companies. Greek bonds surged.
The Standard & Poor’s 500 Index rose 0.8 percent to 1,160.38 at 4 p.m. New York time, after recovering from a 1 percent decline earlier. The Stoxx Europe 600 Index advanced 0.7 percent as banks rallied. The euro appreciated 0.4 percent to $1.3559 and rose versus 15 of 16 major peers. The Greek two-year yield tumbled 453 basis points to 65.24 percent. Natural gas slid 1.4 percent as the U.S. reported a rise in supplies, while oil climbed.
The S&P 500 rallied as much as 2.2 percent early in the trading day, after the U.S. economy grew at a 1.3 percent pace in the second quarter, faster than previously estimated, and applications for jobless benefits dropped by a more-than- forecast 37,000 to 391,000, the fewest since April, according to government data. German Chancellor Angela Merkel gained support from lawmakers to expand the European Financial Stability Facility’s firepower.
U.S. stocks declined, halting a three-day rally for the Standard & Poor’s 500 Index, amid growing concern that European leaders are divided over how to handle Greece’s debt crisis.
All 10 industry groups in the S&P 500 fell at least 0.6 percent, with companies most-tied to economic growth dropping the most. Dow Chemical Co. (DOW) and Alcoa Inc. (AA) slid at least 4.9 percent as commodities tumbled. Morgan Stanley and Bank of America Corp. (BAC) lost more than 4.9 percent, pacing declines among financial shares. Amazon.com Inc. (AMZN) rose 2.5 percent after the company launched its Kindle Fire tablet computer, taking aim at Apple Inc.’s bestselling iPad.
The S&P 500 lost 2.1 percent to 1,151.06 at 4 p.m. New York time, after rising as much as 0.8 percent earlier and rallying 4.1 over the previous three days. The Dow Jones Industrial Average fell 179.79 points, or 1.6 percent, to 11,010.90 today, with all 30 stocks retreating.
Advanced Micro Devices Inc. (AMD) fell 14 percent, the most since 2008 on a closing basis, after the second-largest maker of processors for personal computers cut its forecasts for third- quarter sales and profits. Netflix Inc. (NFLX) retreated 11 percent after people with knowledge of the matter said Microsoft Corp. (MSFT) will offer online pay television service.