Global Markets Overview - 14 November 2012
U.S. STOCK MARKETS
Home Depot led a rally in stocks tied to consumers' discretionary spending, leading U.S. stock benchmarks higher and fueled optimism about the U.S. housing market.
The Dow Jones Industrial Average added 42 points, or 0.3%, to 12857 in midday trading. Home Depot climbed 4.1% after raising its 2012 earnings forecast on housing-market improvement, putting the blue-chip retailer on track to close at a 12-year high.
The Standard & Poor's 500-stock index rose six points, or 0.5%, to 1386. The Nasdaq Composite Index was up one point, or 0.1%, at 2906.
On the economic front, the National Federation of Independent Business said its small-business optimism index for October inched up in September, bucking economists' forecasts for a decline.
The federal budget deficit widened to $120 billion in October, the first month of the government's new fiscal year. The deficit compared with a $98.47 billion shortfall last year and was greater than economists' forecasts for $113 billion.
Elsewhere in the corporate arena, Microsoft fell 2.7% after news that Steven Sinofsky, head of the software maker's Windows business, is leaving the company.
Dick's Sporting Goods gained 4.9% after reporting quarterly results that topped its forecast and raising its current-year profit target. Dow Chemical rallied 1% after Goldman Sachs analysts raised their stock-investment rating on the company to "buy" from "neutral."
EUROPEAN STOCK MARKETS
European stock markets shook off worries about Greece to stage a late-session rebound Tuesday, tracking Wall Street higher on the back of signs the U.S. housing market is on the mend.
The Stoxx Europe 600 index rose 0.4% to close at 270.60, breaking a four-session losing streak. The index spent most of the session in negative territory, however, as investors grew impatient with the lack of a solution for Greece's funding needs.
Shares of E.ON AG plunged 12% in Frankfurt. The utility firm swung to a third-quarter loss as it booked impairment charges on thermal power plants across Europe and lowered its 2013 earnings forecast.
Another conspicuous decliner, shares of Vodafone Group PLC slumped 2.5% in London, after results for the six months to Sept. 30 showed it swinging to a loss.
In the opposite direction, shares of Sonova Holding AG jumped 8.5%, as the hearing-aid manufacturer said net income rose 44% in first half of the year.
Investors trained their eyes on Greece, after euro-zone finance ministers delayed releasing the next tranche of the country's bailout money.
In a news conference late Monday, Jean-Claude Juncker, leader of the ministerial group, and International Monetary Fund Managing Director Christine Lagarde disagreed over whether Greece should be given until 2022 to bring its debt level down to 120% of gross domestic product.
On the data front in Europe, Germany's ZEW expectations index unexpectedly fell to minus 15.7 in November from minus 11.5 in October. Shares of risk-sensitive sectors, such as banks rose.
Deutsche Bank AG shares added 1.9% in Frankfurt, while those of Commerzbank AG gained 0.7%. Shares of K+S AG slid 4.5% after the salt and fertilizer company narrowed its 2012 outlook to the lower end of its previously forecast range.
Germany's DAX 30 index closed marginally higher at 7,169.12. In France, shares of Electricite de France SA fell 1.3%. However, shares of Credit Agricole SA added 3.1% and BNP Paribas SA shares advanced 2.4%.
The CAC 40 index ended the day 0.6% higher at 3,430.60. In London, shares of ITV PLC jumped 9% after the commercial-television network reported a 4% increase in revenue for the nine months to Sept. 30. Shares of heavyweight bank HSBC Holdings PLC climbed 0.8%, while Barclays PLC shares rose 1%. The U.K.'s FTSE 100 index gained 0.3% to 5,786.25.
ASIA-PACIFIC STOCK MARKETS
Asian markets continued to decline Tuesday amid concerns over the U.S. fiscal cliff and Greece's future in the euro zone. Chinese stocks fell sharply, with the Shanghai Composite down 1.5% to 2047.89, close to a seven-week low, after the China's Minister of Housing and Urban-Rural Development Jiang Weixin said Monday that the there are no plans to loosen property tightening measures.
The announcement pushed down property developers. China Vanke and Gemdale Corp. dropped 2.2% and 3.9%, respectively, in mainland China, while in Hong Kong China Resources Land dropped 1.5% and China Overseas Land & Investment lost 1%.
Hong Kong's Hang Seng Index, which was down 1.1% at 21188.65, was also weighed down by energy companies, after declines in the price of oil in recent sessions.
China Petroleum and Chemical Corp. fell 3%. The poor performance of the Hang Seng China Enterprises Index, down 2% at 10230.07, put the shares of dual-listed Chinese companies at a premium in China, compared to their Hong Kong listing.
The Hang Seng China AH Premium Index, which started showing mainland stocks at a discount in mid-October, climbed to 100.94, putting Chinese shares back at a 0.9% premium. Japan's Nikkei Stock Average also sank into negative territory, down 0.2% to 8661.05.
Olympus Corp., the Japanese electronics company hit by a $1.5 billion accounting scandal, jumped 5.9% in Tokyo after increasing its net profit forecast for the full year.
Also in Japan, Hitachi Corp. added 0.5% after a Nikkei report said that two of its subsidiaries, Hitachi Metals and Hitachi Cable, plan to merge in April to create a materials producer operating in automotive and electronics parts, as well as fiber optics.
South Korea's Kospi Composite was off 0.6% to 1889.70. Trading in Asia was subdued as markets in India, Singapore and Malaysia were closed for public holidays.
COMMODITIES
Base metals on the London Metal Exchange closed mostly in positive territory after a rise in wider markets and a strengthening euro lifted the complex after a weaker morning.
At the close of open-outcry trading, flagship base metal LME three-month copper was 0.6% higher on the previous session's settlement at $7,680 a metric ton.
Crude-oil futures fell Tuesday following weak economic data in Europe and a report from the International Energy Agency that warned of limited oil demand. Light, sweet crude for December delivery settled 19 cents lower at $85.38 a barrel on the New York Mercantile Exchange, after falling as low as $84.58 a barrel earlier in the session.
Gold futures closed lower after a choppy session, with some strength in the dollar pressuring prices as concerns over the U.S. fiscal cliff and the euro-zone debt crisis kept investors on edge. Gold for December delivery fell $6.10, or 0.4%, to settle at $1,724.80 an ounce on the Comex division of the New York Mercantile Exchange. Compiled from MORRISON SECURITIES PTY. LTD.