4:00 PM New York – Wall Street turned higher and shook of early gloom as investors hunted for bargains. World Bank lowered the global economic growth to 3% in 2013. ING agreed to pay a record find of $619 million for violating sanctions placed for transactions linked to Cuba and Iran.
U.S. stocks climbed the wall of worries and popular indexes reversed earlier losses and gained nearly 1%.
Speculation mounted on Wall Street for another stimulus as the euro zone stress lift bond yields of Spain and Italy. Import prices fell 1% in May, the largest monthly decline in two years.
The median U.S. households lost more than one third of its wealth in three years to 2010 according to the latest survey released by the Federal Reserve.
ING Bank agreed to pay a $619 million penalty for facilitating transactions on behalf of Cuban and Iranian clients using the U.S. financial system that violated sanctions placed on two regimes. The fine is the largest for sanctions violations and authorities conducted two years of investigations.
In corporate news, FactSet Research dropped 10% after the financial data integrator offered weaker revenues and earnings outlook. Finisar fourth quarter surged 48% to $13.2 million. Texas Instruments tightened second quarter outlook. Under Armour announced 2-for-1 stock split. Textron jumped 3% after a subsidiary of Berkshire Hathaway placed orders for 150 Citation Latitude jets that are worth $9.6 billion.
Zynga Inc, the maker of online social games dropped to a new low and extended the decline to 48% from its first day of trading as a listed company after monthly active users fell 8% according to an analyst.
PNC Financial Services Group decreased 1.6% after the seventh largest U.S. commercial bank by deposits said it will boost its reserves by $350 million to pay for the charges stemming from defective mortgages.
European markets traded higher in choppy trading but stress in bond market turned investors cautious. Spanish bond yields rose above 6.5% for the second day in a row and Italian bond yields jumped above 6% forcing policy makers to turn attention to Italy.
Investors were also worried about the election results in Greece this Sunday as two leading parties with opposing views on the euro zone were neck-to-neck in the opinion polls.
Market sentiment in Tokyo trading was weak as investors worried that the latest Spanish bank bailout will not arrest the widening debt contagion in Europe. Retailers were in focus after government proposes to double consumption tax to 10% by 2014.
Australian stocks traded higher on the first day of trading. Resource companies were in focus after international prices of commodities extended losses. The euro zone worries shifted to Italy and Greece. Qantas surged 10%.
Commodities, Bonds and Currencies
The yields on 10-year U.S. bonds increased to 1.66% and 30-year U.S. bonds edged advanced to 2.77%.
The U.S. dollar edged up 0.2% to $1.2499 to one euro and gained against the Japanese yen to 79.46 in New York trading.
Immediate delivery futures of Texas crude oil increased 69 cents to $83.37 a barrel and Brent crude futures fell 94 cents to $97.06. Futures of natural gas increased 0.02 cents to $2.23 per mbtu and gasoline price decreased 0.6 cents to 265.07cents a gallon.
In metals trading, copper decreased 0.7 cents to $3.33 per pound, gold increased $9.00 to $1,605.80 per ounce and silver added 18 cents to $28.85.