Foreign Markets
After giving up gains late in trading yesterday, markets in Europe continued the negative momentum. The European Union reported that GDP in the 4tth quarter fell 1.6%, 10 basis points greater than economists had expected. Britain’s FTSE 100 fell 1.2 % to 3,944.70, Germany’s DAX dropped 1 % to 4,304.63, and France’s CAC 40 slipped 1.2 % to 2,896.06.
In Asia, the Japanese central bank announced it was keeping its benchmark interest rate unchanged at 0.1 % as expected. The Nikkei 225 stock average closed down 25.08 points, or 0.3 %, to 8,832.85 while Hong Kong’s Hang Seng fell 69.07 points, or 0.5 %, to 14,928.97.
The Australian Central Bank cut its benchmark interest rate 25 basis points, or 0.25% to 3%. The figure is a 49 year low as the recession deepens. The country’s main index fell 1.3%.
U.S. Futures
The street waits with anticipation as Alcoa (AA), a blue chip component will report at the close of trading. Expectations are extremely low and traders are looking for them to be met. However, earnings are what were (past) and the market is priced at what is believed to be. Ahead of the opening bell, futures are pointing to continue yesterday’s selloff. Dow Jones industrial average futures dropped 95, or 1.2 %, to 7,821. Standard & Poor’s 500 index futures fell 12.20, or 1.5 %, to 818.20, while Nasdaq 100 index futures fell 18.25, or 1.4 %, to 1,293.75.
Stocks fell to start the trading week as IBM was unable to reach a deal worth $7 billion to acquire Sun Microsystems; while investors took a step back to survey the financial landscape. Going for its 5th straight weekly gain, the Dow lost 0.5 %, to 7,975.85. The Standard & Poor’s 500 index fell 0.8 %, to 835.48 and the Nasdaq composite index dropped 1 %, to 1,606.71.
Currencies and Commodities
The dollar traded at 100.142 yen, depreciating 0.8397% in the currency market. The euro fell 1.194% to $1.3256, while the pound retreated 0.833% to $1.4646. Gold is advancing $6.60 to $879.40 an ounce while silver dropped 0.41% to $12.16 as investor confidence seems to have shifted. Light, sweet crude for May delivery fell 1.68% to $50.19 a barrel on global recovery skepticism.
Economic News
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ICSC-Goldman Store Sales: Weekly measure of comparable store sales at major retail chains, published by the International Council of Shopping Centers. The figure accounts for roughly 10% of total retail sales.
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Consumer Credit: Measures the value of consumer credit outstanding. Changes in consumer credit indicate the state of the consumer’s finances and can forecast their future spending patterns. Credit availability is tight in the current environment at the same time as households cut back and deleverage their finances. The consensus for February is a decline of $3.0 billion, however the range goes as low as $-5 billion. Credit unexpectedly rose $1.8 billion in January.
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