Stocks: Tuesday's review
The Nikkei 225 Stock Average rose 0.2 percent to 10,525.19 following a 1.8 percent slide yesterday amid intensified fighting in Libya and a surge in oil prices that heightening concern higher fuel costs will impede the economic recovery.
Oil prices have risen about 25 percent since protesters began calling for the ouster of leader Muammar Qaddafi on Feb. 16. Crude for April delivery fell today for the first time in three days, dropping as much as 97 cents to $104.47 a barrel in electronic trading on the New York Mercantile Exchange after al- Jazeera reported Qaddafi offered to relinquish power.
Shipping companies led declines after Nippon Yusen, Japan’s largest fleet operator by sales, said it may reduce vessel speeds by 10 percent in order to cut costs. Hitachi, which makes everything from home appliances to nuclear reactors, gained 1.8 percent after agreeing to sell its disk-drive unit to Western Digital Corp. Terumo, Japan’s No. 1 medical-device maker, climbed 3.2 percent after saying it will buy a unit of Gambro AB that makes blood transfusion equipment.
European stocks advanced as oil fell from a 29-month high, offsetting concern that the European Central Bank will raise interest rates several times this year.
Crude fell in New York after Kuwait’s Oil Minister confirmed that the Persian Gulf country has held talks to boost production. Organization of Petroleum Exporting Countries are holding “consultations” and have yet to decide to raise output, Sheikh Ahmad al-Abdullah al-Sabah said.
BT Group Plc (BT/A) and Deutsche Telekom AG led a rally in phone companies after Morgan Stanley recommended the industry’s shares. Andritz AG (ANDR) rose 4.6 percent after reporting higher-than- estimated full-year net income. National Bank of Greece SA (ETE) and EFG Eurobank Ergasias SA (EUROB) both lost more than 6 percent as the yield on Greek 10-year bonds surged to a record.
U.S. stocks advanced, snapping a two-day decline for benchmark indexes, as crude oil retreated and Bank of America Corp. (BAC) sparked a rally in financial shares after saying its home-loan business is in “recovery mode.”
Bank of America jumped 4.4 percent, leading a gauge of financial shares to the biggest gain among 10 Standard & Poor’s 500 Index industries. Sprint Nextel Corp. (S) climbed 4.5 percent after people with knowledge of the matter told Bloomberg News that Deutsche Telekom AG held talks to sell its T-Mobile USA unit to the company. PulteGroup Inc. climbed 8.2 percent after the homebuilder reported “good traffic and sign-up rates.”
The S&P 500 yesterday erased last week’s gain as oil reached a 29-month high. The gauge rallied 4.2 percent this year through yesterday as companies reported earnings that topped analysts’ estimates for the eighth straight quarter and the Federal Reserve kept interest rates at a record low.
Crude oil fell as members of the Organization of Petroleum Exporting Countries discussed whether to hold a special meeting and Libyan rebels prepared an offensive to regain a town. Kuwait’s oil minister said OPEC members are considering whether to convene an “urgent meeting.”