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Showing posts with label ADVFN III World Daily Markets Bulletin; June 05. Show all posts
Showing posts with label ADVFN III World Daily Markets Bulletin; June 05. Show all posts

Jun 5, 2013

ADVFN III World Daily Markets Bulletin; June 05, 2013.

ADVFN III World Daily Markets Bulletin
Daily world financial news Wednesday, 05 June 2013

US Market
Stocks Seeing Modest Weakness In Early Trading

Stocks are seeing modest weakness in early trading on Wednesday, adding to the losses posted in the previous session. The major averages have dipped into negative territory, although selling pressure remains relatively subdued. Currently, the major averages are all in the red.
The Dow is down 56.67 points or 0.4 percent at 15,120.87, the Nasdaq is down 6.12 points or 0.2 percent at 3,439.14 and the S&P 500 is down 6.06 points or 0.4 percent at 1,625.32. The modest weakness on Wall Street comes following the release of a report from payroll processor ADP showing weaker than expected private sector job growth in the month of May.

ADP said private sector employment increased by 135,000 jobs in May following a downwardly revised increase of 113,000 jobs in April. Economists had expected private sector employment to increase by about 171,000 jobs.

The report has raised some concerns about Friday's monthly jobs report from the Labor Department, although the data has also eased worries about the outlook for the Federal Reserve's stimulus program.

Joel Naroff, president and chief economist at Naroff Economic Advisors, said, "The warning from today's reports is that the Fed should think longer and harder before it does anything. Bad fiscal policy should not be matched by bad monetary policy." "All that said, the ADP report has been off lately so Friday's employment report may not be terrible. But don't expect it to be great," he added. "Nevertheless, investors cannot be cheered by a potential soft jobs report as it raises questions about future earnings." Utilities, healthcare provider, and brokerage stocks are seeing some weakness in early trading, although most of the major sectors are showing only modest moves.

In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Wednesday. Japan's Nikkei 225 Index tumbled by 3.8 percent, while Hong Kong's Hang Seng Index ended the day down by 1 percent.

The major European markets have also moved to the downside on the day. While the German DAX Index is down by 0.7 percent, the French CAC 40 Index is down by 0.9 percent and th.'e U.Ks FTSE 100 Index is down by 1.5 percent.

In the bond market, treasuries have moved moderately higher on the heels of the disappointing jobs data. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 2.5 basis points at 2.112 percent.

Canadian Market
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TSX Dips At Open Wednesday

Bay Street stocks dipped at open Wednesday amid marginal selling across a variety of sectors, with the S&P/TSX Composite Index losing 81.27 points or 0.64 percent to 12,512.70.

The Diversified Materials Index was down about 1 percent, with Teck Resources and First Quantum Minerals losing around 1 percent each.

Among financial stocks, CIBC, Bank of Montreal and TD Bank were down nearly 1 percent each.

In the oil patch, Penn West Petroleum shed 0.50 percent after announcing that Murray Nunns, President and CEO will retire effective July 1, 2013 and would be succeeded by David Roberts, former Executive Vice President and COO of Marathon Oil Corp.

Ladies' wear specialty apparel retailer Reitmans Canada surrendered over 1' percent after reporting a wider first-quarter net loss.

Meanwhile, gold stocks were moving higher, with Agnico-Eagle Mines, Barrick Gold, Seabridge Gold and Goldcorp.  adding over 1 percent each.

Laurentian Bank Of Canada Q2 Profit Rises

Laurentian Bank of Canada reported second-net income available to shareholders of C$31.08 million or C$1.10 per share compared to C$30.70 million or C$1.22 per share last year. Excluding items, net income was C$40.5 million or C$1.29 per share, compared to C$36.3 million or C$1.31 per share prior year.

Net interest income increased to C$140.43 million from C$128.32 million prior year. Total revenue was C$214.85 million compared to C$198.67 million last year.

The Board of Laurentian Bank of Canada approved an increase of 2% to the quarterly dividend and declared a dividend of C$0.50 per common share, payable on August 1, 2013, to shareholders of record on July 2, 2013.

European Market
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European Markets Fall Amid Stimulus Worries

The European markets are firmly in negative territory on Wednesday, mirroring markets in Asia and the overnight session in the U.S., ahead of data from the world's largest economy that may indicate the future course of action for the Federal Reserve.

Economic reports due from the U.S. include data on private sector employment, labor productivity and service sector activity as well as the Fed's Beige Book. Kansas City Fed President Esther George Tuesday reiterated her support for scaling back the pace of asset purchases "in light of improving economic conditions."

Germany's service sector shrank for the second month in a row in May, reflecting worsening business conditions, final data from Markit Economics showed. The final services Purchasing Managers' Index registered 49.7 in May, up from 49.6 in April. The final reading is slightly below the preliminary estimate of 49.8.

The euro area economy shrank 0.2 percent sequentially in the first quarter as initially estimated, second estimates from Eurostat showed. The recession, thus extended into the sixth quarter.

Meanwhile, Eurozone's retail sales declined for a third successive month in April. Sales dropped 0.5 percent month-on-month in April, faster than a 0.2 percent fall reported in March. Economists had forecast a 0.2 percent fall.

Japan's Prime Minister Shinzo Abe unveiled a blueprint covering a wide range of areas to bolster economic recovery in the third largest economy. In a speech delivered in Tokyo, Abe pledged to lift income by 3 percent annually over 10 years. He aims to recover 50 trillion yen in national income that was lost over the two decades.

The Euro Stoxx 50 index of eurozone bluechip stocks is declining 1.27 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, is falling 1.09 percent.

The German DAX and the French CAC 40 are declining 1.2 percent and 1.3 percent, respectively. The UK's FTSE 100 is retreating 1.6 percent while Switzerland's SMI is falling 0.8 percent.

In Frankfurt, K+S is losing 1.9 percent. Berenberg cut its price target on the stock. Deutsche Boerse is losing 1.6 percent and HeidelbergCement is dropping 1.5 percent. SAP and Allianz are notably lower. Continental is gaining 2.3 percent and ThyssenKrupp is advancing 2.2 percent. Grenkeleasing is higher by 1.3 percent. HSBC raised the stock to ''Overweight'' from ''Neutral.''

In Paris, Carrefour is losing 4.6 percent. HSBC reduced its rating on the stock to ''Underweight'' from ''Neutral.'' Publicis Groupe is losing 2.7 percent and Alstom is falling around 2 percent. Bucking the trend, EDF is adding 2.7 percent.

In London, Man Group is declining more than 14 percent after the firm reported lower assets for its flagship fund. Aberdeen Asset Management is declining 4.4 percent.

Tesco is falling around 2 percent after the retailer reported first-quarter like-for-like sales in the U.K. that were less than estimated.

In Zurich, Zurich Insurance is declining 1.5 percent. The stock was cut to ''Neutral'' from ''Buy.''

Elekta is gaining 4.1 percent in Stockholm after the medical equipment maker said net sales in 2013/14 are expected to grow by more than 10 percent in local currency.

Asia Market
Asian Stocks Fall On Fed Uncertainty, Growth Worries

Asian stocks fell on Wednesday as uncertainty prevailed over when the Federal Reserve would begin scaling down its massive bond-buying program.

Federal Reserve Bank of Kansas City President Esther George yesterday supported slowing the pace of bond-buying "as an appropriate next step for monetary policy" rendering investor mood cautious ahead of a slew of U.S. economic reports due later in the day and before Friday's all-important monthly jobs report.

Growth worries also returned to the fore after Australia's growth data undershoot expectations and the pace of growth in China's services sector showed little change in May from the previous month.

China's service sector grew only marginally in May, adding more downside risks to China's growth rate in the second quarter. A survey by Markit Economics and HSBC showed that the headline business activity index edged up to 51.2 from 51.1 in April, with new orders increasing modestly from the previous month.

The composite output index that measures activity at both manufacturing and service sector firms fell to 50.9 from 51.1 in April, suggesting near-stagnation in private sector output.

Japanese shares tumbled, tracking a volatile yen, which firmed up following Prime Minister Shinzo Abe's "Third Arrow" growth strategy speech. Abe outlined a blueprint for rejuvenating the country's ailing economy with plans to boost per-capita income by 3 percent annually, increase capital spending by 10 percent over the next three years and set up special economic zones to attract foreign businesses. Investors were disappointed by lack of specific measures to bolster growth in the world's third-largest economy.

The Nikkei average plunged 519 points or 3.83 percent to 13,015, a two-month low, while the broader Topix index retreated 3.2 percent. Market heavyweight Fast Retailing plummeted 9.5 percent, brokerage Nomura Holdings slumped 7.6 percent and exporter Tokyo Electron tumbled 6 percent. Mitsubishi Motors Corp. fell 5.7 percent following its announcement that it will recall 4,460 imported Outlander vehicles in China manufactured between mid-November 2012 and late March 2013.

China's Shanghai Composite index edged down marginally and Hong Kong's Hang Seng lost a percent to end at a six-week low as China's service sector data painted a mixed picture of the world's second-largest economy.

Australian shares slumped to a four-month low, with a pair of weaker-than-expected economic reports weighing on the market. The benchmark S&P/ASX 200 fell 66 points or 1.34 percent to 4,835, dragged down by banks and miners. BHP Billiton, Rio Tinto and Whitehaven Coal lost about 1.4 percent each, while Newcrest plunged 5.3 percent. Commonwealth slid 1.3 percent, while ANZ and Westpac fell about 3 percent each.
Macmahon Holdings plunged over 11 percent after a unit of Glencore Xstrata prematurely terminated a contract for mining services at the underground CSA copper mine in New South Wales.

Australia's gross domestic product gained a seasonally adjusted 0.6 percent in the first quarter of 2013 compared to the previous three months, the Australian Bureau of Statistics said, falling below expectations for 0.8 percent growth. Separately, activity in the services sector contracted to a 13-month low in May, a report from the Australian Industry Group showed. The AIG's performance of services index fell 3.5 points to 40.6, marking its 16th consecutive month of contraction.

South Korea's Kospi average retreated 1.5 percent to a near four-week low on deepening uncertainty over the course of U.S. monetary policy. STX Group shares as well as lenders to the group, Woori Finance Holdings and Hana Financial, bore the brunt of the selling on reports shipping firm STX Pan Ocean will soon enter court receivership.

New Zealand shares lost ground, weighed down by the downbeat Australian GDP data. The benchmark NZX-50 index fell 20 points or half a percent to 4,454. Dual-listed banks Westpac and ANZ lost 3-4 percent, leading the decliners on the exchange. Air New Zealand eased 0.3 percent after it agreed to settle an antitrust suit with the Commerce Commission.

Fletcher Building, the nation's largest construction company, declined 1.5 percent even as data from Statistics New Zealand showed residential building activity in New Zealand spiked a seasonally adjusted 12 percent in the first quarter of 2013 compared to the previous three months, marking the highest increase in 10 years. Heartland New Zealand soared 6.3 percent to its highest level since February 2011 after the company decided to take an upfront charge against distressed assets.

The markets in Indonesia, Malaysia, Singapore and Taiwan were down between 0.1 percent and 1.1 percent. India's Sensex was marginally higher on recovery hopes after data showed activity in India's service sector expanded at its fastest pace in three months in May.

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Crude Edges Up Ahead Of Inventories Data

The price of crude oil was ticking higher Wednesday morning as traders await more cues from official inventories data due out later today.

Light Sweet Crude Oil (WTI) futures for July delivery, edged up $0.31 to $93.62 a barrel. Yesterday, oil settled marginally lower even as investors awaited fresh catalysts ahead of the weekly inventories data with the dollar strengthening against a basket of major currencies. Analysts expected crude oil inventories to decline a modest 1 million barrels last week.

Tuesday after the market hours, the API said US crude oil inventories tumbled 7.8 million barrels and gasoline stocks declined 1.3 million barrels in the weekended May 31.

This morning the U.S. dollar was lingering around its one-month low versus the euro and the Swiss franc, while trading near its three-week low against sterling. The buck continued to hover around its 4 year high versus the yen.

Gold Struggles To Sustain Above $1,400

The price of gold was little changed Wednesday morning on fears of a slowdown in demand in the world's biggest bullion consumer, India. Also, traders await more clarity over the future of the US central bank's stimulus program

Gold for August delivery, the most actively traded contract, eased $1.00 to $1.396.20 an ounce. Yesterday, gold settled below the $1,400-mark as the dollar strengthened against a basket of major currencies on some better-than-expected trade data out of the U.S. Investor also weighed reports of lower physical demand from India, the world's largest gold consumer. India is reportedly planning to impose further restrictions on gold imports to balance its widening trade deficit, which is linked to unprecedented gold imports.

In an attempt to restrict gold import to curb burgeoning current account deficit, the Reserve Bank of India on Tuesday extended the norm on import of gold on consignment basis from banks to all nominated agencies/star trading houses who have been permitted by the government to import gold. Importers used to get 3-7 days time for funds arrangement. Instead, they would have to pay 100 percent cash upfront now.

Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, moved down to 1,010.45 tons from 1,013.15 tons.

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