Stocks: Wednesday's review
Japanese stocks advanced, sending the Topix index to its first gain in three days, as a decline in oil prices eased concern higher energy costs will impede the global economic recovery.
Nippon Yusen K.K. , Japan’s No. 1 shipping line, climbed 1.7 percent as cargo rates increased and oil prices eased for a second day. Nintendo Co., the world’s largest maker of video- game players, jumped 3.7 percent, after saying a new game set a sales record. Bridgestone Corp., the biggest tiremaker, advanced 3.1 percent after Citigroup Inc. raised the stock’s target price.
Sheikh Ahmad al-Abdullah al-Sabah, Kuwait’s oil minister, yesterday told reporters that the OPEC secretariat is considering holding talks on increasing production amid supply disruptions in Libya. Crude for April delivery decreased as much as 81 cents to $104.21 a barrel in electronic trading on the New York Mercantile Exchange today.
European stocks declined as concern that continuing unrest in the Middle East and North Africa will harm the economy overshadowed takeover bids for Iberdrola Renovables SA (IBR) and Tognum AG. (TGM)
Alcatel-Lucent SA paced falling shares after U.S. rival Finisar Corp. forecast earnings that missed estimates. Tullow Oil Plc (TLW) dropped 3.2 percent after the Africa-focused explorer reported profit that lagged forecasts. Iberdrola Renovables jumped 11 percent after parent company Iberdrola SA (IBE) bid 2.5 billion euros ($3.5 billion) to buy out minority investors. Tognum rallied 7.3 percent as Daimler AG and Rolls-Royce Group Plc offered to buy the company.
Gains in Europe were also limited after Moritz Kraemer, managing director of European sovereign ratings at Standard & Poor’s, warned some countries may have their credit ratings cut further while a Greek debt default is a “possibility.”
Portugal today borrowed 1 billion euros in the first bond auction for two months, opting to endure surging interest costs as it tries to avoid following Greece and Ireland in seeking a bailout. The nation sold 5.45 percent bonds due September 2013 at an average yield of 5.993 percent, compared with an average yield of 4.086 percent at a sale of the same-maturity debt on Sept. 8.
U.S. stocks swung between gains and losses as violence in Libya tempered optimism that the biggest equity rally since 1955 will be extended into a third year.
Caterpillar Inc. (CAT) and DuPont Co. fell at least 1.1 percent, pacing losses in industrial shares. Texas Instruments Inc. (TXN) slumped 3.1 percent as the largest analog chipmaker narrowed its profit estimate. Finisar Corp. (FNSR) tumbled as much as 38 percent, leading other network-equipment makers lower, as its profit forecast missed analyst estimates. International Business Machines Corp. (IBM) rose to a record as Deutsche Bank AG lifted its share-price estimate for the largest computer-services provider.
Crude oil fluctuated near $105 a barrel as a surge in supplies at a U.S. hub overshadowed concern about escalating violence in Libya.