31 Mar
Daily Market Commentary

Best Q1 Since 1999!

Thursday, March 31, 2011
Stock Market Commentary:

Stocks were quiet on Thursday as the major averages enjoyed their best Q1 since 1999 and traders awaited Friday’s much anticpated jobs report.  It was encouraging to see a slew of leading stocks and the benchmark S&P 500, Dow Jones Industrial Average, Nasdaq composite, and small cap Russell 2000 index all close above their respective 50 DMA lines last week. The 28-week rally, which began on the September 1, 2010 follow-through day (FTD), ended on Thursday March 10, 2011 when all the major U.S. averages plunged below their respective 50 DMA lines in heavy trade. However, the correction was short lived when a new rally was confirmed on Thursday March 24, 2011′s healthy action. The healthy action suggests the bulls are back in control. Interestingly, it took other sources 4 days before recognizing that important fact. We have received a ton of positive feedback about our calls in recent weeks and months, and are happy to be able to help!

Jobless Claims Fall & Market Averages Q1 Results:

Before Thursday’s open, the Labor Department said initial jobless claims fell by -6,000 to a seasonally adjusted 388,000 last week. This was better than the Street’s estimate for a decline of -2,000 but the prior week’s numbers were revised up to 394,000 from an originally reported 382,000. The up tick in jobs bodes poorly for Friday’s monthly jobs report. Economists believe U.S. employers added 195,000 jobs in March. The Labor Department is slated to release March’s non farm payrolls report before Friday’s open. For the quarter, the small cap Russell 2000 index topped its peers, rallying +7%. Elsewhere, the Nasdaq composite rose +4.5%. The benchmark S&P 500 and the Dow Jones Industrial Average both rose +5.5% and +6.6%, respectively.

Market Action-Confirmed Uptrend

From our point of view, the market is back in a confirmed uptrend after a modest (and healthy) -6% correction from its post-recovery highs. The fact that the Dow Jones Industrial Average, small-cap Russell 2000 index, and Copper all closed above their respective 50 DMA lines on Wednesday March, 23 was a very healthy sign and suggests higher prices will follow.  The very next day, the benchmark S&P 500 regained that important level and broke above its downward trendline (shown above). Couple that with the fact that other markets like Oil, Silver, and Gold are all at fresh post recovery highs suggests it is only a matter of time until equities follow. The final bullish sign for us was that a slew of high ranked stocks triggered fresh technical buy signals this week which suggests higher, not lower prices lie ahead. If you are looking for specific help navigating this market, please contact us for more information.

Don’t Miss Out!
Have You Seen How Our New Site Can Help You!
Visit: www.SarhanCapital.com Today!

31 Mar
Media Quotes

Adam Sarhan Reuters Quote: METALS-Copper crumbles amid Chinese demand doubts

Wed Mar 30, 2011 3:20pm EDT
* Copper sinks as Chinese demand worries mount
* Copper stocks in China, LME warehouses in the spotlight
* U.S. copper runs into technical support at 100-day MA
* Coming up; Chinese manufacturing data Friday
(Recasts, updates with U.S. copper closing, adds graphic,
analyst comments and NEW YORK dateline/byline)
 
By Chris Kelly and Rebekah Curtis
NEW YORK/LONDON, March 30 (Reuters) – Copper prices ended
sharply lower on Wednesday, on pace for their biggest monthly
decline since June 2010, as weaker demand cues from China and
fears about a moderation in the global economic recovery kept
many bulls sidelined.
 
Chinese monetary tightening measures, coupled with unrest
in the Middle East, rising oil prices, euro zone debt problems
and Japan’s nuclear crisis have all combined to throw the
magnitude of the global economic recovery into question, and
with it, demand for raw materials.
 
As a result, copper prices have responded, falling more
than 12 percent from their mid-February peaks at $10,190 per
tonne in London and $4.6575 per lb in New York, before
recovering to stand in aimless ranges at quarter’s end.
“From a fundamental standpoint, it’s leading a lot of
people to question whether or not they want to remain long
copper going into a new quarter,” said Adam Sarhan, chief
executive of Sarhan Capital in New York.
 
London Metal Exchange copper for three-month delivery
CMCU3 dropped $209 to close at $9,381 a tonne, on track for a
5 percent fall in March, its first monthly decline since June
2010.
U.S. copper HGK1 followed suit, extending a downtrend in
place since mid-February before running into some technical
support near its 100-day simple moving average.
 
It settled down 7.25 cents at $4.2740 per lb.
Trading volumes began to perk up, with more than 47,000
lots traded by 2:24 p.m. EDT (1924 GMT). This was the first
time volume topped 47,000 lots since March 17, according to
preliminary Thomson Reuters data.
 
“All the bets were put on China,” said Eugen Weinberg, an
analyst at Commerzbank. “Sentiment in China is not as rosy and
not as upbeat as sentiment in Europe or the U.S.”
That being said, attention will now turn to Chinese
manufacturing data on Friday, where market participants will
see if the country’s vast manufacturing sector will recover
from the six-month low hit in February. [ID:nL3E7ET1H8]
“Are they going to maintain the growth, given that the auto
sector is in doubt and imports are trending lower,” asked Bart
Melek, vice president and director of commodities, rates
research & strategy with TD Bank Financial Group. “It’s
expected to move up by consensus a bit, but, if it’s a
disappointment, watch out.”
 
Despite the more cautious Chinese outlook, Jiangxi Copper
Co Ltd (0358.HK)(600362.SS), the country’s largest copper
producer, expects China’s consumption to rise by 10 percent to
12 percent this year and plans a 60 percent rise in its own
production capacity by 2015. [ID:nL3E7EU1D3]
Even data showing strong hiring by U.S. private employers
failed to give the market a boost, as investors awaited
Friday’s closely watched government report on non-farm
payrolls. [ID:nN30275708]
 
TRADITIONALLY STRONG QUARTER
Traders and analysts are waiting to see what will happen in
the second quarter, traditionally the strongest in terms of
demand, when China normally buys ahead of a pick-up in
construction activity in the third quarter.
 
“Anecdotally, something in the region of 600,000 tonnes of
refined copper currently (sits) in bonded warehouses in
Shanghai, with perhaps another 100,000 tonnes in the southern
ports,” Standard Bank said in a note.
 
Also in the spotlight are LME stocks of copper, which added
225 tonnes on Wednesday, bringing total warehouse levels to
439,725 tonnes, their highest since last July. <0#LME-STOCKS>
In other metals, aluminium CMAL3 came within $2 of
Tuesday’s session peak at $2,656 per tonne, its highest since
September 2008, before ending down $19 at $2,629.
Metal Prices at 3:48 p.m. EDT (1948 GMT)
COMEX copper in cents/lb, LME prices in $/T and SHFE prices in
yuan/T
Metal Last Change Pct Move End 2010 YTD Pct
move
COMEX Cu 426.85 -7.80 -1.79 444.70 -4.01
LME Alum 2629.00 -19.00 -0.72 2470.00 6.44
LME Cu 9380.00 -210.00 -2.19 9600.00 -2.29
LME Lead 2655.00 -30.00 -1.12 2550.00 4.12
LME Nickel 26025.00 -575.00 -2.16 24750.00 5.15
LME Tin 31225.00 -525.00 -1.65 26900.00 16.08
LME Zinc 2335.00 -40.00 -1.68 2454.00 -4.85
SHFE Alu 16835.00 5.00 +0.03 16840.00 -0.03
SHFE Cu* 71300.00 470.00 +0.66 71850.00 -0.77
SHFE Zin 18375.00 95.00 +0.52 19475.00 -5.65
** Benchmark month for COMEX copper
* 3rd contract month for SHFE AL, CU and ZN
SHFE ZN began trading on 26/3/07
(Additional reporting by Pratima Desai in London; Editing by
Walter Bagley)

30 Mar
Daily Market Commentary

Stocks Rally On ADP Jobs Report

Wednesday, March 30, 2011
Stock Market Commentary:

Stocks rallied on Wednesday after healthy news from the ailing jobs market was released and Portugal’s bond auction went well.  It was encouraging to see a slew of leading stocks and the benchmark S&P 500, Dow Jones Industrial Average, Nasdaq composite, and small cap Russell 2000 index all close above their respective 50 DMA lines last week. The 28-week rally, which began on the September 1, 2010 follow-through day (FTD), ended on Thursday March 10, 2011 when all the major U.S. averages plunged below their respective 50 DMA lines in heavy trade. However, the correction was short lived when a new rally was confirmed on Thursday March 24, 2011′s healthy action. The healthy action suggests the bulls are back in control. Interestingly, it took IBD 4 days before recognizing that important fact. We have received a lot of positive feedback about our calls in recent weeks and months, and are happy to be able to help!

ADP Jobs Report & Portugal’s Bond Auction:

Before Wednesday’s open, ADP, the country’s largest private payrolls company, said U.S. employers added 201,000 jobs in March. The report was just shy of the Street’s 205k estimate but bodes well for Friday’s official non farm payrolls report. Elsewhere, Portugal’s five-year bond yield jumped above +9% for the first time since the euro’s inception in 1999! Keep in mind, that the first quarter will end on Thursday and a lot of last minute “window dressing” is likely occurring.

Market Action-Confirmed Uptrend

From our point of view, the market is back in a confirmed uptrend after a modest (and healthy) -6% correction from its post-recovery highs. The fact that the Dow Jones Industrial Average, small-cap Russell 2000 index, and Copper all closed above their respective 50 DMA lines on Wednesday March, 23 was a very healthy sign and suggests higher prices will follow.  The very next day, the benchmark S&P 500 regained that important level and broke above its downward trendline (shown above). Couple that with the fact that other markets like Oil, Silver, and Gold are all at fresh post recovery highs suggests it is only a matter of time until equities follow. The final bullish sign for us was that a slew of high ranked stocks triggered fresh technical buy signals this week which suggests higher, not lower prices lie ahead. If you are looking for specific help navigating this market, please contact us for more information.

Don’t Miss Out!
Have You Seen How Our New Site Can Help You!
Visit: www.SarhanCapital.com Today!

 

29 Mar
Daily Market Commentary

Housing Prices & Consumer Confidence Miss Estimates

Tuesday, March 29, 2011
Stock Market Commentary:

Stocks were quiet after two important economic reports were released: S&P Case/Shiller Home Price Index and consumer sentiment. It was encouraging to see a slew of leading stocks and the benchmark S&P 500, Dow Jones Industrial Average, Nasdaq composite, and small cap Russell 2000 index all close above their respective 50 DMA lines last week. The 28-week rally, which began on the September 1, 2010 follow-through day (FTD), ended on Thursday March 10, 2011 when all the major U.S. averages plunged below their respective 50 DMA lines in heavy trade. However, the correction was short lived when a new rally was confirmed on Thursday March 24, 2011′s healthy action. The healthy action suggests the bulls are back in control.

Home Prices & Consumer Confidence Fall:

Before Tuesday’s open, the S&P/Case-Shiller index of home prices in 20 major cities slid -3.1% from January 2010 which was the largest year-over-year decline since December 2009. The decline was the latest in a series of weaker than expected data from the ailing housing market. After the open, the latest reading on consumer confidence missed estimates. The Conference Board’s consumer confidence index fell to a three month low of 63.4 which was lower than the Street’s forecast of 65. The down tick in consumer confidence was largely attributed to surging energy prices.

Market Action-Confirmed Uptrend

From our point of view, the market is back in a confirmed uptrend after a modest (and healthy) -6% correction from its post-recovery highs. The fact that the Dow Jones Industrial Average, small-cap Russell 2000 index, and Copper all closed above their respective 50 DMA lines on Wednesday March, 23 was a very healthy sign and suggests higher prices will follow.  The very next day, the benchmark S&P 500 regained that important level and broke above its downward trendline (shown above). Couple that with the fact that other markets like Oil, Silver, and Gold are all at fresh post recovery highs suggests it is only a matter of time until equities follow. The final bullish sign for us was that a slew of high ranked stocks triggered fresh technical buy signals this week which suggests higher, not lower prices lie ahead. If you are looking for specific help navigating this market, please contact us for more information.

Don’t Miss Out!
Have You Seen How Our New Site Can Help You!
Visit: www.SarhanCapital.com Today!

 

28 Mar
Daily Market Commentary

Consumer Spending, Incomes, & Inflation Rise

Monday, March 26, 2011
Stock Market Commentary:

Stocks opened higher on Monday after U.S. consumer spending rose more than expected last month. It was encouraging to see a slew of leading stocks and the benchmark S&P 500, Dow Jones Industrial Average, Nasdaq composite, and small cap Russell 2000 index all close above their respective 50 DMA lines last week. The 28-week rally, which began on the September 1, 2010 follow-through day (FTD), ended on Thursday March 10, 2011 when all the major U.S. averages plunged below their respective 50 DMA lines in heavy trade. However, the correction was short lived when a new rally was confirmed on Thursday March 24, 2011′s healthy action. The healthy action suggests the bulls are back in control.

Consumer Spending Tops Estimates & Incomes Rise

Before Monday’s open, consumer spending in the U.S. rose more than forecast as incomes rose. The Commerce Department said purchases rose +0.7% in February which was the strongest increase since October 2010 and bodes well for the economic recovery. Meanwhile, U.S. income rose +0.3%, less than forecast, as the Federal Reserve’s preferred measure of inflation rose. Elsewhere, according to Bloomberg, U.S. corporations are beginning to spend the record $940 billion in cash they have accumulated after the credit crisis. Out of the U.S. corporations that have tapped their cash reserves the lion share have decided to pursue strategic mergers and acquisitions. M&A’s topped $256 billion in Q1 2011 which is the highest level since the collapse of Lehman Brothers Holdings Inc. in September 2008. So far in Q1 2011, companies in the S&P 500 have authorized +38% more buybacks in han the same period in 2010 and dividends may increase to a record $31.07 a share in 2013, according to data complied by Bloomberg.

Market Action-Confirmed Uptrend

From our point of view, the market is back in a confirmed uptrend after a modest (and healthy)-6% correction from its post-recovery highs. The fact that the Dow Jones Industrial Average, small-cap Russell 2000 index, and Copper all closed above their respective 50 DMA lines on Wednesday March, 23 was a very healthy sign and suggests higher prices will follow.  The very next day, the benchmark S&P 500 regained that important level and broke above its downward trendline (shown above). Couple that with the fact that other markets like Oil, Silver, and Gold are all at fresh post recovery highs suggests it is only a matter of time until equities follow. The final bullish sign for us was that a slew of high ranked stocks triggered fresh technical buy signals this week which suggests higher, not lower prices lie ahead. If you are looking for specific help navigating this market, please contact us for more information.

Don’t Miss Out!
Have You Seen How Our New Site Can Help You!
Visit: www.SarhanCapital.com Today!

 

25 Mar
Daily Market Commentary

Strong Week on Wall Street; New Rally Confirmed!

Friday, March 25, 2011
Stock Market Commentary:

It was a strong week on Wall Street as a slew of leading stocks triggered fresh technical buy signals and the benchmark S&P 500, Dow Jones Industrial Average, and small cap Russell 2000 index all closed above their respective 50 DMA lines. The 28-week rally, which began on the September 1, 2010 follow-through day (FTD), ended on Thursday March 10, 2011 when all the major U.S. averages plunged below their respective 50 DMA lines in heavy trade. However, the correction was short lived when a new rally was confirmed on Thursday March 24, 2011′s healthy action. The healthy action suggests the bulls are back in control.

Monday-Wednesday’s Action: Stocks Rise As Nuclear Threat Eases

Over the weekend, allied forces removed several of Qaddafi’s key military strong holds in Libya. This weakened the aging dictator and will hopefully lead to a peaceful resolution to the three week conflict, lead by the Libyan people. The nuclear threat eased markedly in Japan which helped allay woes that an all out nuclear meltdown will occur. These two events helped stocks rally across the globe. Meanwhile, in the U.S., existing home sales plunged while the median home price fell to the lowest level since April 2002. The National Association of Realtors said existing home sales tanked -9.6% to a 4.88 million annual rate which is less than the 5.13 million median forecast and bodes poorly for the ailing housing market. The report also showed that the median price fell -5.2% from the same period last year and a whopping 39% were sales of distressed properties. On Tuesday, stocks traded in a relatively quiet range as investors digested the market’s recent move. The Federal Housing Finance Agency (FHFA) said its Home Price Inde (HPI) fell -0.3% in January which is the latest in a series of weaker-than-expected data from the ailing housing market.
On Wednesday, U.S. stocks edged higher as investors looked past an ominous report from the ailing housing market. Stocks edged higher helping the Dow Jones Industrial Average and Copper both close above their respective 50 DMA lines for the first time in two weeks. In other news, the Egyptian stock market opened for the first time in nearly two months. Egyptian stocks, which enjoyed explosive gains for much of the last decade, plunged right at the open which triggered a series of circuit breakers which closed the exchange for half an hour. When the market reopened, it rallied slightly off the lows before closing down nearly -9%. Europe’s periphery countries remain in flux. The cost of insuring their debt jumped with credit-default swaps (CDS) on Portugal surging after the Prime Minister resigned and the Parliament rejected austerity plans.  Interestingly, the euro remains strong as it remains perched below multi month highs! In the U.S., the Commerce Department said new home sales plunged to record lows which bodes poorly for the ailing  housing market.

Thursday & Friday’s Action: Stocks Confirm New Rally!

Before Thursday’s open, two important economic reports were released: durable goods and jobless claims. Durable goods, which are items meant to last at least three years, unexpectedly fell -0.9% last month. Excluding transportation, new durable goods orders slid -0.6%, after a -3.0% decline in January. Meanwhile, the Labor Department said weekly jobless claims slid -5,000 last week to -382,000 which bodes well for the recovering jobs market. Before Friday’s open, the latest read on Q4 2010 GDP was released at 3.1% which was higher than the latest estimate of +2.8%. Shortly after the open, consumer confidence plunged in the U.S. which did little to curb the session’s strong gains.

Market Action-Confirmed Uptrend

From our point of view, the market is back in a confirmed uptrend after a modest (and healthy)-6% correction from its post-recovery highs. The fact that the Dow Jones Industrial Average, small-cap Russell 2000 index, and Copper all closed above their respective 50 DMA lines on Wednesday March, 23 was a very healthy sign and suggests higher prices will follow.  The very next day, the benchmark S&P 500 regained that important level and broke above its downward trendline (shown above). Couple that with the fact that other markets like Oil, Silver, and Gold are all at fresh post recovery highs suggests it is only a matter of time until equities follow. The final bullish sign for us was that a slew of high ranked stocks triggered fresh technical buy signals this week which suggests higher, not lower prices lie ahead! If you are looking for specific help navigating this market, please contact us for more information.

Don’t Miss Out!
Have You Seen How Our New Site Can Help You!
Visit: www.SarhanCapital.com Today!

 

 

24 Mar
Daily Market Commentary

Latest Rally Confirmed! Stocks Rally On Mixed Economic Data

Thursday, March 24, 2011
Stock Market Commentary:

On Thursday, U.S. stocks opened higher after the latest read on durable goods and jobless claims were released. The 28-week rally, which began on the September 1, 2010 follow-through day (FTD), ended on Thursday March 10, 2011 when all the major U.S. averages plunged below their respective 50 DMA lines in heavy trade. However, Thursday March 24, 2011’s healthy action confirmed the current rally attempt which suggests the bulls are back in control.

Durable Goods & Jobless Claims:

Before Thursday’s open, two important economic reports were released: durable goods and jobless claims. Durable goods, which are items meant to last at least three years, unexpectedly fell -0.9% last month. Excluding transportation, new durable goods orders slid -0.6%, after a -3.0% decline in January. Meanwhile, the Labor Department said weekly jobless claims slid -5,000 last week to -382,000 which bodes well for the recovering jobs market. The latest read on Q4 GDP is slated to be released before Friday’s open. It was already revised down to +2.8% from the initial +3.2% estimate.

Market Action-Confirmed Uptrend

From our point of view, the market is back in a confirmed uptrend after a modest (and healthy) -6% correction from it’s post-recovery highs. The fact that the Dow Jones Industrial Average, S&P 500, small-cap Russell 2000 index, and Copper all closed above their respective 50 DMA lines on Wednesday March, 23 was a very healthy sign and suggests higher prices will follow.  The very next day, the benchmark S&P 500 regained that important level and broke above its downward trendline (shown above). Couple that with the fact that other markets like Oil, Silver, and Gold are all at fresh post recovery highs suggests it is only a matter of time until equities follow. The final bullish sign for us was that a slew of high ranked stocks triggered fresh technical buy signals this week which suggests higher, not lower prices lie ahead! If you are looking for specific help navigating this market, please contact us for more information.

Don’t Miss Out!
Have You Seen How Our New Site Can Help You!
Visit: www.SarhanCapital.com Today!

 

23 Mar
Daily Market Commentary

Stocks Edge Higher; Look Past Sour Housing Data

Wednesday, March 23, 2011
Stock Market Commentary:
On Wednesday, U.S. stocks edged higher as investors looked past an ominous report from the ailing housing market. The 28-week rally, which began on the September 1, 2010 follow-through day (FTD), ended on Thursday March 10, 2011 when all the major U.S. averages plunged below their respective 50 DMA lines in heavy trade. The current crisis in the Middle East remains in flux which is putting upward pressure on oil and gold and downward pressure on equities. The benchmark S&P 500 was up nearly 100% from its March 2009 low before its latest correction and is still about -17% off its all-time high from October 2007.

Dow Closes Above 50 Day Moving Average line & Home Prices Continue to Fall:

Stocks edged higher helping the Dow Jones Industrial Average close above its 50 DMA line for the first time in two weeks. However, the other major averages closed below their respective 50 DMA lines which means that level still remains the the next level of resistance for those indices. Elsewhere, The Japanese stock market slid nearly -2% as the clean up efforts remain in full force. In other news, the Egyptian stock market opened for the first time in nearly two months. Egyptian stocks, which enjoyed explosive gains for much of the last decade, plunged right at the open which triggered a series of circuit breakers which closed the exchange for half an hour. When the market reopened, it rallied slightly off the lows before closing down nearly -9%.
Europe’s periphery countries remain in flux. The cost of insuring their debt jumped with credit-default swaps (CDS) on Portugal climbing 10 basis points to 544. That is the highest reading since the middle of January and the cost of insuring Irish debt jumped eight basis points to a fresh seven week high of 625. This put downward pressure on the Euro which has enjoyed healthy gains for much of 2011. In the U.S., the Commerce Department said new home sales plunged to record lows which bodes poorly for the ailing  housing market.

Market Action- Market In A Correction; 28-Week Rally Ends

All the major averages sliced below their respective 50 DMA lines on Thursday, March 10, 2011.  Thursday, March 17, 2011 marked day 1 of a new rally attempt which means that the earliest a possible follow-through day (FTD) could emerge would be Tuesday, as long as Thursday’s lows are not breached. That said, the window is now open for a new FTD  to emerge which will confirm the current rally attempt. However, if Thursday’s lows are breached, then the day count will be reset and odds will favor lower prices, not higher, will follow. It is important to note that the recent ominous action reiterates the importance of raising cash and playing strong defense until a new FTD emerges. If you are looking for specific help navigating this market, please contact us for more information.

Don’t Miss Out!
Have You Seen How Our New Site Can Help You!
Visit: www.SarhanCapital.com Today!

 

 

23 Mar
Media Quotes

Reuters Quote: GLOBAL MARKETS-Euro falls, bunds up on fears over Portugal debt

Wed Mar 23, 2011 4:03pm GMT
* Euro slips as Portugal vote looms

 * Sterling falls on UK growth projections
 * Europe debt concern weighs on U.S. stocks
 * Gold, bunds up on safety bid
 (Updates with Portuguese parliament debate, updates prices,
adds copper)
 By Rodrigo Campos
 NEW YORK, March 23 (Reuters) - Worries that a political
crisis in Portugal could force the debt-laden country to seek a
bailout sent the euro lower on Wednesday and triggered
safe-haven demand for German government bonds.
 The renewed fears of a euro zone debt crisis drove down
European banking shares and weighed on stocks in New York. U.S.
Treasury debt prices, which had risen earlier on safe-haven
demand, slipped following a Federal Reserve purchase.
 Uncertainty over the longer-term impact of Japan's
earthquake, tsunami and nuclear crisis fueled a safety bid for
precious metals, driving up the price of gold and sending
silver to the highest price since 1980.
 The cost of insuring Portugal's five-year debt against
default hit two-month highs, reflecting the growing belief that
Lisbon will follow Greece and Ireland in seeking emergency
funding if parliament rejects a new series of austerity
measures. The yield on Irish government bonds also soared to
new euro-lifetime highs.
 Portugal's parliament started a plenary session to debate
the government's austerity measures, setting the stage for the
likely collapse of the minority Socialist administration. Prime
Minister Jose Socrates has threatened to resign if the package
is rejected in a vote expected later on Wednesday.
 "There's currently a lot of concern on the Portuguese
budget vote and the potential political implication for it. The
fear is that if Portugal failed to agree on austerity measures,
we can potentially see the country forced into the EFSF" rescue
fund, said Mary Nicola, currency strategist at BNP Paribas in
New York.
 Hopes that this week's European summit would yield a
decision on how to increase the effective capacity of the euro
zone bailout fund were dashed after the release of a draft
document prepared for the meeting. The decision will likely
come in June. [ID:nBRU011391].
 Portugal's political crisis has knocked the euro from its
recent 4-1/2-month highs against the U.S. dollar, although the
slide is expected to be temporary, given the expectation for
the European Central Bank to raise interest rates next month.
 The euro EUR=EBS was last down 0.4 percent at $1.4138,
having hit a low for the session of $1.4105, according to
trading platform EBS.
 The renewed concerns over European debt kept European
stocks near break even and took a toll on Wall Street.
 A plunge in sales of new U.S. single-family homes in
February to the lowest level since 1963 also weighed on Wall
Street, as the data from the U.S. Commerce Department suggested
the housing market slide was deepening. [ID:nCAT005396]
 "If the data continues to implode the way it has been,
we'll see new lows in the stocks. And if that happens, we'll
have to expect a protracted downtrend in the market. When the
market gets better --it will happen-- you'll see it first in
housing stocks," said Adam Sarhan, chief executive of Sarhan
Capital in New York.
 An objection by the Federal Reserve to Bank of America's
(BAC.N) plans to boost its dividend weighed on U.S. bank
shares. Bank of America shares fell 2.6 percent.
 The Dow Jones industrial average .DJI edged up 2.15
points, or 0.02 percent, to 12,020.78. The Standard & Poor's
500 .SPX dropped 3.77 points, or 0.29 percent, to 1,290.00.
The Nasdaq Composite .IXIC fell 4.62 points, or 0.17 percent,
to 2,679.25.
 The FTSEurofirst 300 .FTEU3 edged up less than 0.1
percent as a rise in mining shares helped offset weaker bank
stocks. The MSCI All-Country World index .MIWD00000PUS fell
0.3 percent, down for the first session in five.
 <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
  U.S. trading volume slowdown    r.reuters.com/gyp68r
  Japan earthquake in graphics    r.reuters.com/fyh58r
  U.S. crude futures chart:    link.reuters.com/maq68r
 ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
 YEN LITTLE CHANGED
 The yen stayed in a tight range close to 81 per dollar,
though traders were wary the Bank of Japan might step in again
if the dollar fell below 80.50, following Friday's rare market
intervention by major central banks to curb Japan's currency.
 Underlining the continuing risks in Japan, authorities
advised against allowing infants to drink tap water in Tokyo
due to raised radiation levels, and the United States blocked
some food imports from Japan. [ID:nL3E7EM3EM]
 Sterling fell 0.7 percent to $1.6253 GBP=D4, hitting the
day's low as UK Chancellor George Osborne released a lower
growth projection for the coming year and increased borrowing
targets from 2011/12 to 2014/15. See [ID:nWLA6167]
 U.S. Treasuries pared early gains to trade slightly
negative in price in the wake of the Federal Reserve's purchase
of $7.56 billion of Treasuries. Benchmark 10-year Treasury
notes US10YT=RR were trading 4/32 lower to yield 3.34
percent, up from 3.33 percent late Tuesday.
 The Bund future FGBLc1 was 29 ticks higher at 122.31.
Germany sold 3.4 billion euros of 10-year bonds, attracting
greater demand than at a previous sale thanks to the
risk-averse mood in markets. [ID:nLDE72M11L]
 U.S. oil prices CLc1 edged higher while Brent LCOc1
traded flat, with prices expected to remain underpinned by
violence in Libya and unrest in Yemen, which neighbors top
producer Saudi Arabia.
 "Yemen is a very hot topic now. It is not that important to
the oil market but unrest in the region gives enough
psychological support to prices," Andy Sommer, energy market
analyst with EGL, said.
 Spot gold XAU= was up 0.7 percent at $1,438.94 an ounce.
Silver XAG= was at $36.86 an ounce at 1547 GMT, just below
the session high of $36.93 an ounce, from $36.34 late in New
York on Tuesday.
 Copper rose over 2 percent to a two-week high on
expectations of a supply deficit this year, but the price
recovery may be hindered by unrest in Libya and concerns about
Japan.
 Egyptian stocks .EGX100 closed 9 percent lower in the
first day of trading on the Cairo exchange since Jan. 27, after
closing due to the political turmoil that ousted Hosni Mubarak
last month.
 (Additional reporting by Ryan Vlastelica, Wanfeng Zhou,
Richard Leong and Ikuko Kurahone; Editing by Leslie Adler)

 
URL: http://uk.reuters.com/article/2011/03/23/markets-global-idUKN2323976720110323

23 Mar
Media Quotes

Reuters Quote: US STOCKS…

Wed Mar 23, 2011 2:37pm GMT

* U.S. home sales hit a record low in February
* Fed tells Bank of America to rein in dividend plan
* Portugal set to vote on austerity measures
* Indexes down: Dow 0.4 pct, S&P 0.7 pct, Nasdaq 0.7 pct
* For up-to-the-minute market news see [STXNEWS/US] (Updates to early morning trade)
By Angela Moon
NEW YORK, March 23 (Reuters) – Wall Street stocks fell on Wednesday after disappointing new home sales data and a Federal Reserve rejection of a dividend plan by Bank of America weighed on banks and home building shares.
U.S. new home sales fell in February to a record low and prices were the lowest since December 2003, suggesting the housing market slide was deepening. For details, see STORY: [ID:nCAT005396] TABLE [ID:nCLANEE7CK]
Bank of America Corp (BAC.N) shares were down 2.2 percent at $13.59, weighing the most on the Dow index, after the Fed objected to the bank’s plans to boost dividends in the second half of 2011 and told the bank to revise its proposal. For details, see [ID:nN23228260]
The KBW bank index .BKX fell 1.4 percent. Citigroup Inc (C.N) shares dropped 1.4 percent at $4.36 and JPMorgan Chase & Co (JPM.N) fell 1.1 percent to $44.96.
Among home builders, Toll Brothers Inc (TOL.N) fell 1.6 percent to $20.16 and D.R. Horton Inc (DHI.N) lost 1.4 percent to $11.68.
“What’s been happening now for the past 18 months or so is we’ve seen a relative low in a lot of housing stocks, meaning they’re bouncing along the bottom. That’s typically a good sign since they tend to lead the housing market by three to nine months,” said Adam Sarhan, chief executive of Sarhan Capital in New York. “As long as the recent lows aren’t taken out, we’d expect some sort of stabilization to occur.”
The Dow Jones industrial average .DJI was down 41.74 points, or 0.35 percent, at 11,976.89. The Standard & Poor’s 500 Index .SPX was down 9.03 points, or 0.70 percent, at 1,284.74. The Nasdaq Composite Index.IXIC was down 17.46 points, or 0.65 percent, at 2,666.41. (Reporting by Angela Moon; Editing by Padraic Cassidy)
 

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