Indian ADRs end strictly lower led by technology and banking ADRs
U.S. stocks ended Thursday, 13 March 2014 with the worst declines
in more than five weeks at Wall Street. The major averages finished the
Thursday session near their lows after renewed concerns surrounding the
situation in Ukraine, combined with more warnings signs from China. The
jitters related to China are tied up in economic and financial risk,
whereas, the concerns over Ukraine are tied up in geopolitical risk that
has the potential to become a global economic problem.
The Dow Jones Industrial Average dropped 231.19 points, or 1.4%, to 16,108.89, falling for the fourth consecutive day. The Nasdaq Composite shed 62.91 points, or 1.5%, at 4,260.42. The S&P 500 closed 21.86 points, or 1.2%, lower at 1,846.34 and erased modest gains for the year.
All thirty Dow components ended lower for the day. Equity indices began the session with modest gains, but the early strength was short-lived. Nine out of ten economic sectors ended lower led by technology and industrials sectors.
The Russian troop occupation of Ukraine is a growing concern among many traders and investors. U.S. and European Union leaders are threatening to impose economic and diplomatic sanctions on Russia.
In overnight developments, there was another downbeat economic report coming out of China on Thursday. China's industrial output rose by 8.6%, year-on-year, in the January and February period. That's lower than the 9.5% rise that was expected and down from a rise of 9.7% in December. Traders and investors are also a bit concerned about China's credit and financial system, given the recent bond default by a Chinese corporation—the first one ever.
U.S. economic data released Thursday included the weekly jobless claims report, import and export price indexes, manufacturing and trade inventories, and retail sales. The data had only a marginal impact on market prices.
Retail sales increased 0.3% in February after declining a downwardly revised 0.6% (from -0.4%) in January. The consensus expected retail sales to increase 0.2%. Sales increased in-line with the 0.2% increase in aggregate earnings that were reported in the February employment report.
The initial claims level fell to 315,000 for the week ending 8 March 2014 from an upwardly revised 324,000 (from 323,000) for the week ending 1 March 2014. The consensus expected the initial claims level to increase to 329,000. The DOL reported that there were no special factors that drove the initial claims level to its lowest point since November 2013.
Separately, total business inventories increased 0.4% in January after increasing an unrevised 0.5% in December while the consensus expected an increase of 0.3%. Total inventories consist of manufacturers, merchant wholesalers, and retailers. The important takeaway from the report was that the inventory gain may not have been planned. Total business sales fell 0.9% in January after declining 0.1% in December. That sharp drop in spending caused an overstock situation as more goods than expected were left on shelves.
The Treasury Budget for February showed a deficit of $193.50 billion, which followed the prior month's deficit of $203.50 billion. The consensus expected the deficit to hit $195.00 billion.
Bullion prices ended in a mixed mode on Thursday, 13 March 2014 at Comex. Gold futures on Thursday settled with a modest gain, as a pullback in U.S. equities helped provide some investment appeal for the precious metal. The U.S. dollar index fell to a 4.5-month low overnight, which also is an underlying bullish factor for the precious metals.
Gold for April delivery rose $1.90, or 0.1%, to settle at $1,372.40 an ounce on the Comex division of the New York Mercantile Exchange. Prices tallied their four-straight session gain and held their ground at a six-month closing high. Earlier, prices for the yellow metal earlier had dropped to as low as $1,364.90 when U.S. equities traded higher on the back of a fall in weekly U.S. jobless claims and a rise in monthly retail sales. May silver continued its descent, closing 16 cents, or 0.8%, lower at $21.20 an ounce.
Crude oil futures finished back above $98 a barrel at Nymex on Thursday, 13 March 2014, finding support after three sessions of losses and on uncertainty surrounding Ukraine, though another round of weak Chinese data kept a lid on any gains. Crude oil for April delivery rose 21 cents, or 0.2%, to end at $98.20 a barrel on Nymex.
Indian ADRs ended lower on Thursday. In the IT space, Infosys shed 2.7% at $54.50 and Wipro declined 2.83% at $13.03. In the banking space, ICICI Bank fell 2.79% at $40.38 and HDFC Bank was down 0.5% at $37.54. In the other sectors, Tata Motors slipped 1.9% at $32.48 and Dr Reddy's Laboratories was down 0.33% at $44.63.
Participation was below average with 678 million shares changing hands at the NYSE floor.
Tomorrow, February PPI will be released at 8:30 ET while the preliminary reading of the Michigan Sentiment Survey for March will cross the wires at 9:55 ET.
The Dow Jones Industrial Average dropped 231.19 points, or 1.4%, to 16,108.89, falling for the fourth consecutive day. The Nasdaq Composite shed 62.91 points, or 1.5%, at 4,260.42. The S&P 500 closed 21.86 points, or 1.2%, lower at 1,846.34 and erased modest gains for the year.
All thirty Dow components ended lower for the day. Equity indices began the session with modest gains, but the early strength was short-lived. Nine out of ten economic sectors ended lower led by technology and industrials sectors.
The Russian troop occupation of Ukraine is a growing concern among many traders and investors. U.S. and European Union leaders are threatening to impose economic and diplomatic sanctions on Russia.
In overnight developments, there was another downbeat economic report coming out of China on Thursday. China's industrial output rose by 8.6%, year-on-year, in the January and February period. That's lower than the 9.5% rise that was expected and down from a rise of 9.7% in December. Traders and investors are also a bit concerned about China's credit and financial system, given the recent bond default by a Chinese corporation—the first one ever.
U.S. economic data released Thursday included the weekly jobless claims report, import and export price indexes, manufacturing and trade inventories, and retail sales. The data had only a marginal impact on market prices.
Retail sales increased 0.3% in February after declining a downwardly revised 0.6% (from -0.4%) in January. The consensus expected retail sales to increase 0.2%. Sales increased in-line with the 0.2% increase in aggregate earnings that were reported in the February employment report.
The initial claims level fell to 315,000 for the week ending 8 March 2014 from an upwardly revised 324,000 (from 323,000) for the week ending 1 March 2014. The consensus expected the initial claims level to increase to 329,000. The DOL reported that there were no special factors that drove the initial claims level to its lowest point since November 2013.
Separately, total business inventories increased 0.4% in January after increasing an unrevised 0.5% in December while the consensus expected an increase of 0.3%. Total inventories consist of manufacturers, merchant wholesalers, and retailers. The important takeaway from the report was that the inventory gain may not have been planned. Total business sales fell 0.9% in January after declining 0.1% in December. That sharp drop in spending caused an overstock situation as more goods than expected were left on shelves.
The Treasury Budget for February showed a deficit of $193.50 billion, which followed the prior month's deficit of $203.50 billion. The consensus expected the deficit to hit $195.00 billion.
Bullion prices ended in a mixed mode on Thursday, 13 March 2014 at Comex. Gold futures on Thursday settled with a modest gain, as a pullback in U.S. equities helped provide some investment appeal for the precious metal. The U.S. dollar index fell to a 4.5-month low overnight, which also is an underlying bullish factor for the precious metals.
Gold for April delivery rose $1.90, or 0.1%, to settle at $1,372.40 an ounce on the Comex division of the New York Mercantile Exchange. Prices tallied their four-straight session gain and held their ground at a six-month closing high. Earlier, prices for the yellow metal earlier had dropped to as low as $1,364.90 when U.S. equities traded higher on the back of a fall in weekly U.S. jobless claims and a rise in monthly retail sales. May silver continued its descent, closing 16 cents, or 0.8%, lower at $21.20 an ounce.
Crude oil futures finished back above $98 a barrel at Nymex on Thursday, 13 March 2014, finding support after three sessions of losses and on uncertainty surrounding Ukraine, though another round of weak Chinese data kept a lid on any gains. Crude oil for April delivery rose 21 cents, or 0.2%, to end at $98.20 a barrel on Nymex.
Indian ADRs ended lower on Thursday. In the IT space, Infosys shed 2.7% at $54.50 and Wipro declined 2.83% at $13.03. In the banking space, ICICI Bank fell 2.79% at $40.38 and HDFC Bank was down 0.5% at $37.54. In the other sectors, Tata Motors slipped 1.9% at $32.48 and Dr Reddy's Laboratories was down 0.33% at $44.63.
Participation was below average with 678 million shares changing hands at the NYSE floor.
Tomorrow, February PPI will be released at 8:30 ET while the preliminary reading of the Michigan Sentiment Survey for March will cross the wires at 9:55 ET.
