Category Archives: Market Update
“European stocks rose, extending their highest level since June 2008, after the Bank of Englandraised its growth forecast for Europe’s third-biggest economy. U.S. index futures were little changed, while Asian shares rallied.
EasyJet Plc (EZJ) led a gauge of travel companies higher after the low-cost airline said it will deliver improved returns and profitability for the full year. Commerzbank AG surged 15 percent on the first day that it offered new shares to investors. ThyssenKrupp AG climbed 1.3 percent after Germany’s biggest steelmaker reported earnings that exceeded estimates.
The Stoxx Europe 600 Index gained 0.4 percent to 306.95 at 1:08 p.m. in London. The equity benchmark has rallied 9.8 percent so far this year, bolstered by monetary stimulus from the world’s central banks. Futures contracts on the Standard & Poor’s 500 Index slipped 0.1 percent today, while the MSCI Asia Pacific Index advanced 0.6 percent.
“Quantitative easing globally is driving the market,” said Andrea Williams, who helps oversee $76 billion as head of European equities at Royal London Asset Management. “Generally, valuations still look reasonable and the corporate results season has also been OK.”
U.S stocks rallied yesterday, sending the S&P 500 to its eighth record in the past nine trading days, amid increased optimism about the world’s largest economy. Asian equities rose today with Japan’s Nikkei 225 Stock Average climbing above 15,000 for the first time since January 2008.
“Asian shares rose as stocks in Japan climbed to their highest level since December 2007 and yields on the nation’s 10-year bond advanced to the most in more than a year. South Korea’s won declined and palladium retreated.
The MSCI Asia Pacific Index added 0.8 percent at 1:12 p.m. in Tokyo as Japan’s Nikkei 225 Stock Average jumped 1.9 percent, breaching 15,000 for the first time since January 2008. Standard & Poor’s 500 Index futures were down 0.1 percent after the equity gauge advanced to a record yesterday. The yen rebounded from a 4 1/2-year low, while the won retreated 0.7 percent. The dollar traded near the strongest in five weeks against the euro as U.S. 10-year Treasury yields headed toward 2 percent for the first time since March. Japan’s 10-year rate climbed as high as 0.92 percent.
Sony Corp. surged as much as 14 percent as billionaire Daniel Loeb’s Third Point LLC hedge fund pushes for the Xperia smartphones and Bravia televisions maker’s breakup. Toyota Motor Corp., the world’s biggest carmaker, rose to pace gains among Japanese exporters, boosted by signs of recovery in the U.S. economy and a falling yen. Data on U.S. April producer prices and first-quarter euro zone GDP are due later today with the former expected to show declines from March, according to a Bloomberg News survey of economists.
“Momentum is building for a global stock rally,” said Hiroichi Nishi, an equities manager in Tokyo at SMBC Nikko Securities Inc., a unit of Sumitomo Mitsui Financial Group Inc. (8316), Japan’s second-biggest lender. “Downward pressure on the yen against the dollar is strengthening, boosting earnings outlooks, especially for exporters.”
About two stocks rose for every one that fell in the MSCI Asia Pacific Index. Toyota increased 2.4 percent while motorcycles maker Yamaha Motor Co. advanced 8.4 percent. The MSCI Asia Pacific Index has gained 11 percent this year versus a 16 percent rally by the S&P 500 and a 9.3 percent advance by the Stoxx Europe 600 Index.
Hong Kong’s Hang Seng Index advanced 0.5 percent, rebounding from its biggest two-day drop in a month. Li & Fung Ltd. jumped 7.4 percent after UBS AG raised its investment rating on the maker of toys and clothing. Sun Hung Kai Properties Ltd. gained 1 percent after the city said it will offer two residential sites for development.
The U.S. dollar traded at $1.2934 per euro from $1.2920 yesterday when it touched $1.2912, the strongest since April 5. The currency has gained as improving sentiment toward the U.S. economy spurred speculation the Federal Reserve will reduce stimulus.
The yen gained 0.3 percent to 102.16 against the greenback after sliding to 102.43, matching the weakest since October 2008. The yen’s 14-day relative strength index versus the dollar was at 29.8603, below the 30 level which indicates an asset’s price has fallen too rapidly and may be poised to reverse course….”
“Emerging-market stocks advanced for the first time in four days as a stronger yen boosted exporters, offsetting the biggest drop in Chinese shares in three weeks and a slide in Russian commodity producers.
LG Electronics Inc. (066570), which got 22 percent of its 2012 revenue from North America, rose the most in a month in Seoul. Hyundai Motor Co. (005380) added 2.7 percent as an appreciating yen eased concerns about a loss of competitiveness to Japanese rivals. Emaar Properties PJSC surged 3.1 percent, helping lift Dubai’s benchmark index to the highest since October 2009 as the real estate market outlook improved. OAO Severstal, a Russian steelmaker, fell for a third day as industrial metals declined on concern Chinese demand may weaken.
The MSCI Emerging Markets Index rose 0.1 percent to 1,043.23 as of 12:50 p.m. in London. The yen strengthened from the lowest level in more than four years against the dollar, benefiting companies that compete with Japanese exporters. JPMorgan Chase & Co. cut its growth outlook for the Chinese economy following data yesterday that showed industrial production missed estimates and fixed-asset investment unexpectedly slowed last month.
“Asian exporters are doing well because there is a view the yen weakening is done in the short-term,” Michael Wang, an emerging-market strategist at Amiya Capital LLP in London, said by e-mail. Concerning China, “there are worries about data still being weak — bad for Russia and Brazil,” he said….”
“Japanese stocks rose, with the Topix Index extending a 4 1/2-year high, as the yen weakened past 102 against the dollar after the Group of Seven signaled tolerance for the currency’s drop.Nissan (7201) Motor Co. and Panasonic (6752) Corp. jumped after posting earnings.
Brokerages rose the most among the 33 Topix industry groups, with Nomura Holdings Inc. surging 9.6 percent. Nissan added 4.5 percent after the automaker forecast net-income to grow 23 percent based on an assumption the yen will trade at 95 to the dollar. Panasonic gained 7.6 percent after the electronics maker topped estimates for operating profit. Sharp Corp. climbed 12 percent after the Nikkei newspaper reported the money-losing TV maker plans to pare its European operations.
The Topix advanced 1.8 percent to close at 1,232.20 in Tokyo, the highest close since Aug. 29, 2008. More than nine stocks gained for every seven that fell. The Nikkei 225 Stock Average (NKY) added 1.2 percent to 14,782.21, with volume 42 percent above the 30-day average.
“G-7 has given a nod to Japan’s measures to beat deflation,” said Kuninobu Takeuchi, Tokyo-based executive portfolio manager at DIAM Co, which oversees the equivalent of about $98 billion. “Exiting deflation means growth, enabling companies to expand. Companies tend to put forward conservative profit forecasts, say a 30-40 percent increase, while the market is pricing growth of 40-50 percent.”
The Topix and the Nikkei have been the top-performing major equity gauges since mid-November, advancing more than 70 percent amid unprecedented monetary easing from theBank of Japan and calls from Prime Minister Shinzo Abe to end deflation.
“We have tracked the key short interest changes as of April 30 in these large cap stocks: General Electric Co. (NYSE: GE), Nokia Corp. (NYSE: NOK), Bank of America Corp. (NYSE: BAC), Verizon Communications Inc. (NYSE: VZ), Alpha Natural Resources Inc. (NYSE: ANR), McDonald’s Corp. (NYSE: MCD), Apple Inc. (NASDAQ: AAPL), BlackBerry (NASDAQ: BBRY), Microsoft Corp. (NASDAQ: MSFT), Dell Inc. (NASDAQ: DELL), Green Mountain Coffee Roasters Inc. (NASDAQ: GMCR) and Cisco Systems Inc. (NASDAQ: CSCO)….”
“Emerging-market stocks declined the most in three weeks and currencies depreciated as the yen’s tumble to a four-year low threatens developing-nation exporters.
Samsung Electronics Co. (005930), South Korea’s biggest exporter of consumer electronics, dropped 2.6 percent in Seoul, while Hyundai Motor Co. (005380) slid the most in three weeks, after the won climbed to its highest level against the yen in more than four years. China Resources Power Holdings Co. sank 11 percent in Hong Kong after saying it will issue shares for a merger. The Philippine peso, Thailand’s baht, the Russian ruble and South Africa’s rand weakened against the dollar.
The MSCI Emerging Market Index fell 0.7 percent to 1,053.53 at 3:25 p.m. in Hong Kong, paring this week’s gain to 1.1 percent. The yen slid beyond 101 per dollar for the first time in four years, helping the nation’s exporters compete at the expense of Asian rivals. Asian currencies dropped on speculation the yen’s slide will prompt some regional policy makers to weaken their exchange rates to protect exports….”
“NEW YORK (AP) — A look at the 10 biggest percentage gainers on Nasdaq at 1 p.m.:
Tesla Motors Inc. rose 26.8 percent to $70.72.
Green Mountain Coffee Roasters Inc. rose 24.9 percent to $74.31.
Synta Pharm rose 12.8 percent to $7.74.
CSP Inc. rose 10.7 percent to $8.25.
Parametric Sound Corp. rose 10.6 percent to $20.68.
Syntroleum Corp. rose 9.3 percent to $6.02.
Providence Service Corp. rose 9.3 percent to $20.19.
Sangamo BioSciences Inc. rose 8.5 percent to $8.54.
Groupon Inc. rose 8.4 percent to $6.06.
Cirrus Logic Inc. rose 8.2 percent to $23.40.”
“Bonds sold to finance Florida housing developments are being issued at the fastest rate in six years as investors seek extra yield from the municipal debt even as 85 percent of such securities have defaulted since 2008.
Known as dirt bonds, the borrowings are sold by districts set up by builders to finance roads and utility lines on raw land for housing. Jurisdictions in Florida have sold $273 million of the debt this year in 25 issues, on pace for the most since 2007 in terms of dollar amount and number of issues, data compiled by Bloomberg show.
The securities are benefitting from home prices in Florida that rose at the end of 2012 to a 21-month high, data from the Federal Housing Finance Agency show. At the same time, investors are hunting for speculative-grade munis, which have earned 3.1 percent this year, compared with 1.5 percent for the broader local market, Barclays Plc data show.
The jump in issuance shows “that many of those housing markets have stabilized,” said Peter Hayes, head of munis at New York-based BlackRock Inc. He oversees $114 billion of local debt, including land-development obligations.
“That helps dirt bonds, along with the fact that they offer more income and more yield than some other sectors,” he said.
“European stocks rose, extending a near five-year high, as financial companies from HSBC Holdings Plc (HSBA) to Allianz SE reported results that topped analysts’ estimates. U.S. index futures were little changed, while Asian shares rose.
HSBC, Europe’s biggest lender, Societe Generale SA (GLE), France’s second-largest bank, and Germany’s Commerzbank AG all climbed at least 1.9 percent after posting results. Allianz SE, Europe’s largest insurer, gained 2.5 percent after reporting a jump in profit. Alstom SA (ALO) (ALO) sank 9.1 percent after the power- equipment maker cut its profit forecast.
The Stoxx Europe 600 Index (SXXP) rose 0.3 percent to 301.96 at 1:02 p.m. in London, as trading resumed in the U.K., Ireland and Greece after yesterday’s public holiday. The gauge has climbed 8 percent this year to its highest level since June 2008 as central banks maintained stimulus measures.
“I am overweight financials,” said Kevin Lilley, a fund manager at Old Mutual Asset Managers U.K. in London, which oversees about $6.1 billion. “It’s been a mixed bag on the earnings front, but surprises are coming through on the financials. I see the market continuing to grind higher.”
Futures on the Standard & Poor’s 500 Index gained 0.1 percent today, while the MSCI Asia Pacific Index rallied 1.2 percent as the Reserve Bank of Australia cut its benchmark interest rate to a record low.
The RBA unexpectedly reduced the overnight cash-rate target by a quarter percentage point to 2.75 percent. Eight of 29 economists predicted the seventh cut in the past 19 months, while money markets had seen about a 50-50 chance.
Europe’s Stoxx 600 (SXXP) closed little changed near a five-year high yesterday as services and manufacturing output shrank for a 15th month, while European Central Bank President Mario Draghi said policy makers are ready to cut interest rates if needed….”
“The Topix Index (TPX) climbed the most in a month, erasing losses from the 2008 collapse of Lehman Brothers Holdings Inc., as Japanese markets reopened from a holiday during which the yen slid and U.S. jobs data beat estimates.
Sony Corp. (6758), Japan’s No. 1 exporter of consumer electronics, rose 6.4 percent. Toyota Motor Corp. (7203) added 4.9 percent after the Nikkei newspaper reported the carmaker will beat profit estimates when it posts results tomorrow. Japan Steel Works Ltd., which forges reactor containment vessels, surged 16 percent after Japan won its first nuclear plant order since the Fukushima meltdowns.
The Topix rose 3.1 percent to close in Tokyo at 1,188.57, a level not seen since before Lehman filed for bankruptcy protection on Sept. 15, 2008. Japan’s broadest gauge of equities has rallied 65 percent since mid-November, making it the world’s best-performing major stock index, as the yen weakened amid optimism a change in government and central bank leadership will pull Japan out of deflation.
“We saw solid U.S. jobs data even though the market was nervous about downside risks, and that’s boosting stock buying,” said Isao Kubo, a Tokyo-based equity strategist at Nissay Asset Management Corp., which oversees about 5 trillion yen ($50.5 billion.) “As the yen has weakened, corporate forecasts suggest profits are going to improve a lot this year. The market likes that.”
After a record earthquake and tsunami, nuclear meltdowns and a surge in the yen, Japan is the last of the five biggest equity markets to recover to pre-crisis levels. Topix industry groupstracking consumer lenders and real estate companies led the recovery from the March 2009 bottom following Lehman’s collapse, almost quadrupling.
The Nikkei 225 Stock Average (NKY) today climbed 3.6 percent to 14,180.24, closing above 14,000 for the first time since June 2008. The exporter-heavy gauge recouped its losses from the Lehman shock on March 9….”
U.S. equities traded in its narrowest range today for the year. Essentially it was a samich day. The DOW transports did hit new highs after Friday’s big gains…so some happiness there full the bulls.
Defensive stocks, drugs, and food companies lagged while bank stocks led the way.
“Emerging-market stocks rose to a seven-week high as Malaysian shares rallied to a record after Prime Minister Najib Razak won elections, U.S. jobs growth bolstered confidence in the global economy and higher oil prices lifted producers.
UEM Land Holdings Bhd. (ULHB) jumped 13 percent in Kuala Lumpur, while CIMB Group Holdings Bhd. (CIMB), Malaysia’s second-largest lender by assets, had its steepest gain since July 2003. The ringgit strengthened the most since 2010. OAO Rosneft, Russia’s largest oil company, advanced to a three-week high. Turk Hava Yollari AO (THYAO), Turkey’s flagship airline, headed for an all-time high.
The MSCI Emerging Markets Index gained 0.5 percent to 1,047.42 at 12:05 p.m. in London, the highest since March 14 on a closing basis. Najib’s coalition extended its 55-year rule, which may allow him to proceed with plans to narrow the budget deficit and boost investments. U.S. payrolls grew by 165,000 last month, more than economists estimated, the Labor Department said May 3.
“The election results in Malaysia were a positive surprise for investors,” Aldo Perkasa, who helps manage about $2 billion at PT Mandiri Manajemen Investasi, said by phone from Jakarta. “The U.S. employment data drove the overall macroeconomic sentiment higher.”
The FTSE Bursa Malaysia KLCI Index rose 3.4 percent, its steepest increase since November 2008 and the highest level on record. Russia’s Micex advanced for a second day, rising 0.3 percent and benchmark gauges in Turkey, Poland and South Africa added at least 0.5 percent….”