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Market Update

Markets in New York and Europe Consolidate on Earnings and Elevated Euro

Author: Bikram Pandey
Last Update: 4:16 PM ET February 07 2013

4:10 PM New York – U.S. market indexes declined after cautious comments from European policymakers and weak earnings. Oil traded near elevated prices and market indexes recovered half the 1% decline. Retailers reported higher same store sales in January.

Stocks in New York traded lower after market sentiment veered towards consolidation and latest earnings failed to spark interest.

Also cautious comments from the European Central Bank President Mario Draghi suggested that the elevated euro could hamper the economic recovery and contribute to price declines.

In economic news, the dollar edged up and gold gained after central banks in Europe and U.K. held rates. U.S. weekly unemployment claims fell in the last week.

U.S. retailers declined despite the increase in monthly same store sales. Gap Inc declined 3% despite the casual apparel retailer reported 8% increase in sales in January. Limited Brands declined 3% despite the 9% increase in sales in the month.

On the earnings front, Cognizant fourth quarter net climbed 16%. Cigna net surged 49% and lifted outlook. Noble Energy net swung to $251 million profit. Sprint loss widened and said it lost 243,000 subscribers in the fourth quarter.

Akamai plunged 15% after it missed quarterly revenues and News Corp declined 2% after the controversial entertainment and news group said ratings for “American Idol” and “X factor” are dropping.

Teradata net jumped 15% and New York Times net surged more than three-fold on capital gains from asset sales.

European markets were generally steady after the central banks in Europe and U.K. left key rates unchanged. Spain completed its bond offering at higher yields but yields fell at French bond auction. Vodafone reiterated its earnings outlook.

Gross Domestic Product is expected to slow down to 5% in the year ending in March as food prices drive inflation to a record high among emerging nations. The government is facing election in next 14 months and is expected to face an uphill battle to lower spending and fiscal deficit.

Ambuja Cements fourth quarter net surged 77% and Apollo Hospitals net jumped 24.7%. AstraZeneca net swung to loss and Cipla net climbed 25.5%. Godrej Ind net soared 112% and HDFC slashed its prime lending rate. Tech Mahindra net surged 36%.

The Nikkei index retreated from a 4-year high and the yen pared back some of the recent weaknesses as investors fear overextended rally may be vulnerable to more yen swings. Sony reported eight quarterly loss and Mazda soared on heavy volume on higher net estimate.

Australian stocks extended gains for the second day on the positive earnings from National Australian Bank, Tabcorp and Telstra. Australian employment increased 10,400 in January and jobless rate held steady at 5.4%.

Commodities, Bonds and Currencies

U.S. treasury yield on 10-year bond declined to 1.95% and on 30-year bond closed unchanged at 3.17%.

The U.S. dollar inched lower to $1.339 to a euro and increased against the Japanese yen to 93.61 yen.

Immediate delivery futures of Texas crude oil decreased 87 cents to $95.76 a barrel and Brent crude rose 54 cents to $117.27, futures of natural gas decreased 0.13 cents to $3.29 per mbtu and gasoline traded down 3 cents to 300.90 cents a gallon.

In metals trading, gold decreased $5.80 to $1,673.10 per ounce and silver fell 38 cents to $31.50 and copper decreased 1.35 cents to $3.72 a pound.

Sources: Data collected by 123jump.com and Ticker.com from company press releases, filings and corporate websites. Market data: BATS Exchange. Inc