Jun 12, 2013
Asia markets swoon; Japan, Hong Kong plunge Asian stocks swoon after uncertainty over U.S. monetary policy lead to more losses on Wall Street, with Japanese shares plunging toward their sixth loss in seven sessions as a strengthening yen hurt exporters. Hong Kong and Shanghai equities tumble after holiday.
Australia jobs data surprise to upside LOS ANGELES (MarketWatch) -- Australia's May employment data surprised markets with a gain in jobs, sending the nation's currency jumping. Total employment rose by 1,100 last month, with the jobless rate holding steady at 5.5%, the Australian Bureau of Statistics said Thursday. The result beat economists' median expectation for a loss of 10,000 jobs and a rise in the unemployment rate to 5.6%, according to a Dow Jones Newswires survey. On the other hand, the gains came on the back of a 6,400 rise in part-time jobs, with full-time positions falling 5,300. Still, the currency market cheered the news, with the Australian dollar rising from 94.55 U.S. cents ahead of the data, to briefly top the 95-cent level before easing back to 94.84 U.S. cents.
Turkish Leader Orders an End to Protests in 24 Hour: The New York Times Global Update; June 11, 2013.
June 12, 2013
Compiled 20:45 GMT
Compiled 20:45 GMT
By TIM ARANGO, SEBNEM ARSU and CEYLAN YEGINSU
Prime Minister Recep Tayyip Erdogan told his interior minister to bring nearly two weeks of demonstrations to a halt.
By HANIA MOURTADA and ANNE BARNARD
Battalions of Sunni fighters stormed a village in eastern Syria, reportedly killing at least 30 people, in a reprisal raid that underscored the sectarian tone of the war.
By KEITH BRADSHER
In an interview with a local newspaper, Edward J. Snowden said he was not hiding from justice, and he accused the United States of hacking computers in Hong Kong and China.
By ISAAC STONE FISH
Would the United States trade its unfettered support of Japan for support from China on dealing with North Korea?
By RICK GLADSTONE
On Tuesday, the Treasury Department banned the Lebanese militant organization from any dealings with Americans, citing its "alarming reach" and intervention in the Syrian civil war.
By NIKI KITSANTONIS
The decision to disband the Hellenic Broadcasting Corporation prompted protests in Athens and threatened the fragile coalition government.
By EDWARD WONG
The journalist, Du Bin, recently released a documentary about a women's forced labor camp and has worked as a freelance photographer for The New York Times.
DealBook P.M. Edition; June 12, 2013: The Trade: Reform Efforts in Washington Reflect Few Lessons of Housing Crisis
Wednesday, June 12, 2013
Stocks sink; Dow’s longest loss streak this year: Wall Street at Close report by marketWatch; June 12, 2013.
By Kate Gibson, MarketWatch
NEW YORK (MarketWatch) — U.S. stocks tumbled on Wednesday, with the Dow industrials falling for three consecutive days for the first time this year, as the Japanese yen furthered its rise and doubts about monetary policy had investors on edge.
“The markets are very much tying off of the Japanese currency and also again, Fed policy, which hasn’t changed, and we don’t think is likely to change this year. But the comments from the various Fed governors are acting as trial balloons,” said Paul Nolte, managing director at Dearborn Partners. “They are getting a sense of the market’s reaction without actually changing policy,” he added.
The Federal Open Market Committee will hold a two-day meeting next week.
Watch Cooper Tire, Pfizer
Cooper Tire & Rubber, Pfizer and Yum Brands are among the stocks traders will be watching during market action. Polya Lesova reports.
After a 119-point opening leap, the Dow Jones Industrial Average DJIA -0.84% fell as much as 140 points and ended at 14,995.23, a loss of 126.79 points, or 0.8%.
The S&P 500 index SPX -0.84% lost 13.61 points, or 0.8%, to 1,612.52, with consumer discretionary pacing losses that extended to all 10 of its major industry groups.
The Nasdaq Composite COMP -1.06% fell 36.52 points, or 1.1%, to 3,400.43.
For each stock rising, more than four fell on the New York Stock Exchange, where nearly 686 million shares traded.
Composite volume neared 3.2 billion.
Volatility’s return to Wall Street can be traced to May 22, when Federal Reserve Chairman Ben Bernanke said the central bank could cut back on its monetary stimulus if the labor market shows “sustainable improvement.”
“We literally spent the entire year without having three down days in a row, just grinding higher, and we never had more than a 3% decline up until May 22,” Art Hogan, market strategist at Lazard Capital Markets, said in a telephone interview late Tuesday.
“The FOMC and Ben Bernanke have introduced volatility into the market for the first time this year, so the introduction of volatility seems extreme to us, but that’s only because we spent the first five months without it,” Hogan said.
Dearborn Partners’ Nolte agreed, saying: “It seems more volatile only because of where we’ve been. It is a return to more normal volatility.”
“The concern over Armageddon is way overblown. I don’t see it as anything more than a correction; it doesn’t mean you rearrange your entire portfolio,” Nolte added.
The Fed’s monetary easing and better-than-anticipated corporate results have fed a bull market now in a fifth year, pushing the S&P 500 up 139% from a 12-year low in 2009.
On Wednesday, the U.S. dollar fell against the Japanese yen USDJPY -0.06% , which on Tuesday rose the most against the greenback in three years.
One day after reaching a 14-month high, the yield on the 10-year Treasury note 10_YEAR +1.83% used in determining mortgage rates and other consumer loans rose to 2.238%.
“Global credit markets are calmer after a tumultuous selloff the past month, sending yields materially higher, but still very low compared with historical averages and where most rates were last year,” wrote Nick Raich, CEO at the Earnings Scout.
“Despite, or maybe because of, the recent sharp rise in 30-year-mortgage rates to 4.15%, mortgage applications in the U.S. were up 16% last week after four weeks of terrible numbers,” Raich added.
On the New York Mercantile Exchange, the cost of crude rose, with oil futures CLN3 +0.47% up 50 cents at $95.88 a barrel, while gold futures GCQ3 +0.78% added $15 to finish at $1,392 an ounce.
In deal news Wednesday, India’s Apollo Tyres Ltd. is acquiring Ohio’s Cooper Tire & Rubber Co. CTB +41.12% in a $2.5 billion transaction. Shares of Cooper Tire rallied 41%.
U.S. stocks fell sharply on Tuesday after the Bank of Japan kept its monetary policy steady, increasing fears that global central banks won't maintain their monetary easing. Unease as to when and by how much the Fed would taper its $85 billion in monthly bond purchases means the market’s recent return to volatility will persist until the Fed’s tapering plan becomes clear. Read: Pimco sees volatility here to stay and a global recession down the road
The Nikkei Stock Average JP:NIK -0.21% shook off a sharper initial drop to close down 0.2% on Wednesday to 13,289.32. In Europe, stocks ended lower Wednesday.
On Thursday, the economic calendar includes government reports on initial jobless claims for last week, along with retail sales for May.
Kate Gibson is a reporter for MarketWatch, based in New York.
Dow Closes Below 15000, Posts First 3-Day Losing Streak This Year: Wall Street at Close report by CNBC; June 12, 2013
Stocks finished near session lows in choppy trading Wednesday, with the Dow posting its first three-day losing streak this year, amid lingering worries of Fed tapering.
(Read More: Why Cyclicals Are Hot for Investors This Summer)
The dollar regained its footing against yen, after dropping as low as 95.16 earlier in the session. The dollar index, which measures the greenback's strength against a basket of currencies, touched its lowest level since February.
"Everyone's watching the yen," said Joe Saluzzi, co-manager of trading at Themis Trading. "Since 'Abenomics' took place in November, you can overlay the S&P 500 against the yen chart and see a nice correlation—so it makes sense to me that when the reverse happens, it should also happen in the stock market. The currency is the leader, not the laggard and it's all by central bankers."
|DJIA||Dow Jones Industrial Average||14995.23||-126.79||-0.84%|
|S&P 500||S&P 500 Index||1612.52||-13.61||-0.84%|
|NASDAQ||Nasdaq Composite Index||3400.43||-36.52||-1.06%|
The Dow Jones Industrial Average finished down more than 100 points, dragged by American Express and IBM, logging its first three-day losing streak this year. The blue-chip index opened up more than 100 points but quickly erased its gains.
The S&P 500 and the Nasdaq also closed in the red, extending their losses from the previous session. The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, spiked above 18.
All S&P sectors reversed their gains to trade lower, dragged by consumer discretionaries, financials and utilities.
Asian shares trimmed losses, after falling sharply in the previous session when the Bank of Japan refrained from introducing measures to ease market volatility. Financial markets in Hong Kong and China were shut on Wednesday for the Dragon Boat holidays, and will reopen on Thursday. In Europe, shares traded higher after the German government encouraged the country's highest court to dismiss a legal challenge to the European Central Bank's government bond-buying program. German Finance Minister Wolfgang Schaeuble said he did not think the ECB had violated its mandate, and that ECB policy was not subject to German law. The demonstration in Turkey grew more chaotic after police cleared Taksim Square early Wednesday. Prime Minister Tayyip Erdogan is expected to meet with the "organizers" of the anti-government protests which have spread throughout Turkey over the past two weeks. "Riots in Istanbul, central banks raising stop signs, bond yields on the rise and equity markets skidding; brace yourselves, we are in for a very rough ride over the coming weeks," wrote Evan Lucas, market strategist at IG. "All this news has led to one thing and one thing only — high volatility. The current 'correction' in the market is heading towards a confidence killer, and this will only see volatility moving even higher." (Read More: Hold On, Japan Bond Market Swings Aren't That Wild)
Data traffic management software maker Gigamon surged more than 30 percent in its trading debut on the New York Stock Exchange. The company sold 6.75 million shares at $19 each, raising nearly $128 million. Hewlett-Packard jumped after CEO Meg Whitman told CNBC that revenue growth is "still possible" for the computer maker in its fiscal year 2014, but added the performance of the overall PC market is a wild card. Yum ticked higher even after the fast-food chains operator reported a 19 percent drop in China same-store sales in May. China is responsible for about half the sales for Yum, the parent of the KFC, Taco Bell, and Pizza Hut restaurant chains. Rambus soared after the company settled a patent case with South Korea's SK Hynix, which will pay the rival chipmaker $240 million. Lennar gained after Keefe Bruyeett & Woods upgraded the homebuilder to "outperform" from "market perform." Other homebuilders including Ryland and DRHorton gained. GlaxoSmithKline rose after the pharmaceutical giant dismissed its head of research and development in China, following an investigation that determined data used in a 2010 research paper was misrepresented. Pfizer advanced after the drugmaker said rival Teva Pharmaceuticals and Sun Pharmaceutical Industries would pay $2.15 billion to settle a patent infringement lawsuit related to its acid-reflux drug Protonix. Meanwhile, the Financial Times reported that Apple bonds had fallen by up to 9 percent in value in under six weeks. H&R Block and Men's Wearhouse are scheduled to post earnings after the closing bell. Treasury prices declined after the government sold $21 billion in 10-year notes at a high yield of 2.209 percent. The bid-to-cover ratio, an indicator of demand, was 2.53. Weekly mortgage applications rose for the first time in a month as a surge in interest rates pushed prospective home buyers to act, according to the Mortgage Bankers Association. —By CNBC's JeeYeon Park. Follow JeeYeon on Twitter:
Internet sales double; Vancouver's new universal access parks pass; Debut of Volvo with Westport fuel system: BIV Today's Business News; June 12, 2013.
Politics and Policy
This Week's Issue
The Conscience of a Liberal Same Old Economics, by Paul krugman: The New York Times Opinion Today June 12, 2013.
June 12, 2013
Opinionator | The Conversation
By DAVID BROOKS and GAIL COLLINS
Brooks and Collins on domestic spying and foreign policy.
By MARK BITTMAN
Regulating mercury emissions would also decrease the presence of other harmful toxins.
Opinionator | Fixes
By SARIKA BANSAL
A waste collection initiative is improving the environment, as well as the livelihoods and social standing of some of the poorest inhabitants in Pune, India.
By THE EDITORIAL BOARD
Security can be achieved by less-intrusive or sweeping means, without trampling on democratic freedoms and basic rights.
By THE EDITORIAL BOARD
Edward Snowden's leaks do not amount to treason, but he is likely going to be headed to jail regardless.
By THE EDITORIAL BOARD
Allowing Plan B One-Step to be sold over the counter to girls and women of all ages is a significant step forward, but several concerns remain.
Read the full opinion report, including editorials, columns, op-eds and Opinionator. Go to the Section »
By ANDREW ROSENTHAL
A Democratic lawmaker wants to repeal the force authorization passed after the 9/11 attacks.
By ROSS DOUTHAT
The costs and consequences of lives shared online.
The Conscience of a Liberal
By PAUL KRUGMAN
The bad ideas go round and round.
Joe Nocera's Blog
A day in the life of armed America.
Dot Earth Blog
By ANDREW C. REVKIN
An imperiled baby deer flees to a human mom before finding its own.