4:40 PM New York – Stocks in New York trading declined and S&P 500 index extended losses for the fifth day in a row. The euro zone turmoil and the growing contagion risk in the region dragged market indexes on both sides of the Atlantic. Facebook is expected to price its public offering at $38 a share and raise $16 billion.
U.S. indexes traded lower as Spain regained focus in the euro zone and banks are expected to need more capital sooner than expected. The S&P 500 index extended losses to the fifth day in a row to a loss of 3.9% and tech heavy Nasdaq declined more than 2% in trading today.
Facebook is expected to complete the sale of 421.2 million shares at $38 each, higher than its revised filing range between $34 and $38. The largest Internet offering is expected to raise $16 billion with the help of 30 underwriters that will also see executives and directors at the company sell as many as 189.4 million shares.
The social networking site reported sales of $4 billion in the year ending in March with more than 900 million users worldwide but new subscriber growth in the U.S. has halted and revenues growth has decelerated for the third year in a row.
U.S. weekly jobless claims were nearly unchanged at 370,000 and foreclosure activity fell in April. Agilent agreed to acquire Denmark-based Dako for $2.2 billion and Boyd Gaming agreed to buy Peninsula Gaming for $1.45 billion.
Dollar Tree first quarter net increased 15% to $116 million. Sears first quarter net swung to $189 million profit and plans for a partial spin-off. Ross Stores first quarter net soared 21% to $208.6 million and Wal-Mart net increased 10% to $3.74 billion.
The European indexes fell on the ongoing worries in Greece and Spain returned to recession in the first quarter. The International Monetary Fund estimates the Italian economy to contract this year. E.ON agreed to sell its gas transmission company to a consortium for about €3.2 billion.
Stocks in Tokyo rebounded in a choppy session after GDP in the last fiscal quarter to March increased 4.1% from a year ago. The GDP declined 0.01% in the fiscal year after exports plunged on supply chain disruptions. Toshiba said it will stop making television sets in Japan as the unit declares a loss.
Australian stocks made a feeble attempt to rebound as mining and banking stocks traded volatile. BHP walked out of a mining venture in north Queensland and said the project is unviable. Coalworks asked shareholders to reject a takeover bid.
Commodities, Bonds and Currencies
The yields on 10-year U.S. bond decreased to 1.70% and 30-year U.S. bond edged lower to 2.80%.
The U.S. dollar edged up to $1.269 to one euro and eased against the Japanese yen to 79.27 yen in New York trading.
Immediate delivery futures of Texas crude oil decreased $0.29 to $92.52 a barrel and Brent crude futures decreased $2.66 to $107.09. Futures of natural gas increased 0.02 cents to $2.63 per mbtu and gasoline price eased 4.51 cents to 287.52 cents a gallon.
In metals trading, copper eased 2.05 cents to $3.45 per pound, gold surged $37.10 to $1,573.70 per ounce and silver increased 82 cents to $28.04.