World Market Overview Report 28/02/2011
US markets
U.S. stocks rose Friday after three days of losses as shares of Boeing surged and as lessening fears over oil supply helped crude prices stabilize. Still, major stock indexes were on track to post their biggest weekly drops of the year. Friday's modest climb shaved off only a portion of the week's losses after anxiety over the unrest in the Middle East and North Africa had sent oil prices to their highest levels in more than two years.Boeing climbed 2.8% after the Air Force awarded a tanker deal valued at more than $30 billion to the company late Thursday.
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Intel was also strong, rising 3%, after Citigroup analysts said sales of personal computers could pick up in March, with Intel, Advanced Micro Devices and Marvell as three of the biggest beneficiaries. Shares of AMD gained 2.2%, while Marvell rose 4.7%. Friday's gains did manage to halt the week's streak of losses.
Crude-oil futures stabilized as worries faded about supply shortages related to the unrest in Libya. Saudi Arabia and a group of major oil-consuming nations said Thursday there is plenty of oil on hand to replace supplies halted from Libya. Crude-oil prices remained below $98 a barrel for most of the session. Stocks also got a mild lift from the Thomson Reuters/University of Michigan consumer-sentiment index, which rose to its highest level in 3 years.
The end-February reading bested the expectations of economists surveyed by Dow Jones Newswires. On this week's U.S. agenda, the February unemployment rate, set to be released Friday, is expected to inch up to 9.1% from 9% in January, according to economists. Auto makers and retailers will report their U.S. sales results for Feb, with both segments broadly expected to report another month of improved sales.
European markets
European bourses snapped a five session losing streak to finish decidedly higher Friday, as investors chose to focus on oil trading below $100 a barrel and set aside for now their concerns about continuing violence in Libya. Paced by rising shares in Paris, the Stoxx Europe 600 index closed up 1.3% to 284.12, paring losses for the week to 2.4%. The gains were broad based, though financial stocks and miners rallied notably. U.S. markets opened higher and got an extra lift early on by solid consumer-sentiment data. European markets have had a rough week, as investors have gotten increasingly spooked by the continued unrest in the Mideast and North Africa.
Most recently, Libya has been in the spotlight, as the oil-producing country teeters on the brink of civil war. Europe buys more than 85% of its oil from the country, which has been ruled by Col. Moammar Gadhafi for more than 40 years. As Gadhafi's grip on power has loosened and rebels have stepped up efforts to oust him, crude operations have been disrupted, leading to a 2 1/2-year high in oil prices early last week.
Asian markets
Most Asian stocks advanced on Friday as investors temporarily looked past turmoil in the Middle East and North Africa to snap up beaten-down shares after an overnight retreat in crude-oil prices. Australia's S&P/ASX 200 rose 0.6%, while Hong Kong's Hang Seng Index and South Korea's Kospi climbed 1.8% and 0.7%, respectively. Japan's Nikkei Stock Average added 0.7%, while Taiwan's Taiex rose 0.7%. China's Shanghai Composite ended little changed after rising for two straight sessions, while India's Sensex shed 0.1%. Dow Jones Industrial Average futures were up 58 points in screen trade. The rebound came as crude-oil prices retreated after the International Energy Agency assured it was prepared to release its emergency oil stockpiles to cover any shortfalls resulting from the turmoil. Saudi Arabia also said the Kingdom definitely can and is willing to supply more oil to the market. April Nymex crude-oil futures rose to a two and a half year high of $103.41 per barrel on Thursday, and were recently up 52 cents at $97.80 a barrel on Globex. Airlines, hard-hit by the recent oil-price surge, were mostly higher around the region. Seoul listed Korean Air Lines Co. added 4.8%, Hong Kong's Cathay Pacific Airways tacked on 3.6%, Australia's Qantas Airways rose 2.2% and Jet Airways India rose 3.5%. Malaysian-based budget carrier AirAsia jumped 6.0% in Kuala Lumpur after reporting fourth quarter net profit jumped more than nine times on-year thanks to higher passenger numbers and stronger yields. Exporters in Tokyo were up as the dollar traded relatively firmly near the Y82 level. Nissan Motor Co. rose 0.7% and Sony Corp. added 1.2% in Tokyo. Toyota Motor Co. advanced 2.2% despite another U.S. recall. Elpida Memory Inc. soared 6.4% after its president signaled a price hike for semiconductor memory chips next month. China shares erased earlier losses to end little changed, paced by financial shares. Banks rose on expectations of robust full-year earnings growth after a mid-sized lender announced a solid earnings report for 2010. Shenzhen Development Bank ended 2.1% higher after it said Friday its net profit for the last fiscal year ended Dec. 31 rose 25% from a year earlier on steady lending growth, although the result was in line with expectations. Industrial & Commercial Bank of China climbed 0.7%, while China Construction Bank gained. In Hong Kong, AIA Group climbed 5.7% after reporting an above expectation 54% on year rise in full-year net profit, helped by a growth in new business. In Sydney, Origin Energy tacked on 5.8% after the company said its $35 billion gas export joint venture with ConocoPhillips agreed to sign China Petrochemical Corp. as a customer. Woolworths advanced 1.3% after saying it's surprised by the strength of its performance at the start of its second half. Woolworths met expectations with a 6.0% rise in first-half profit to A$1.16 billion, driven by higher food and liquor sales.
Base metals
Copper pushed higher to a strong close on the London Metal Exchange Friday, supported by stabilizing oil prices, though market players remain divided over the metal's prospects for the coming week. At the PM kerb close, LME three-month copper traded up 2.7% at $9,760 a metric ton. The rest of the complex also finished higher, tracking flagship copper's progress. With the market's focus firmly on the potential inflationary impact of rising oil prices, a cooling of crude oil futures Friday lent a tailwind to the base metals. After trading at two and a half year highs Thursday, crude oil stabilized below $100 a barrel, as concern over the impact of supply disruptions in conflict-torn Libya eased. Nymex crude oil, for April delivery, recently traded at $97.37 a barrel, up just seven cents on the day. Crude futures settled higher Friday, ending near $98 a barrel as oil markets remain focused on the violent unrest in Libya. Light, sweet crude for April delivery settled up 60 cents at $97.88 a barrel on the New York Mercantile Exchange. Brent crude on the ICE futures exchange settled 78 cents higher at $112.14 a barrel. Oil prices finished the week up 14%, but the surge came amid a roller-coaster trading environment due to falling oil production in Libya. Gold futures retreated Friday as a calmer picture in the Middle East and stabilizing oil prices soother investors' nerves. The most actively traded contract, for April delivery, settled down 0.5%, or $6.50, at $1,409.30 per troy ounce on the Comex division of the New York Mercantile Exchange.
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