Stocks: Thursday's review
21.01.2011, 07:53

Stocks: Thursday's review

Japan’s Nikkei 225 Stock Average fell the most since November after oil and metal prices dropped and U.S. housing starts decreased more than estimated, renewing concern the U.S. economic recovery will remain sluggish.
Mitsubishi Corp., Japan’s largest commodities trader, lost 0.9 percent. Canon Inc., the world’s biggest camera maker, and Nintendo Co., the largest maker of portable video-game consoles globally, dropped more than 2 percent. Tokyo Electron Ltd., the world’s No. 2 maker of semiconductor equipment, retreated 3.8 percent on concern industry growth may slow.
The Topix sank 1 percent in 2010 as the yen at its strongest annual average level against the dollar since 1971 dimmed the outlook for export earnings, and as Europe’s debt crisis, China’s steps to curb inflation and concern about U.S. growth damped confidence in a global economic recovery.

European stocks fell for a second day as accelerating Chinese economic growth fueled speculation the government will lift interest rates further to calm inflation, overshadowing a drop in U.S. jobless-benefit claims.
Fiat SpA and Volkswagen AG led automakers lower and Rio Tinto Group, the world’s third-largest mining company, sank the most in two months amid concern demand from China will be hurt. EasyJet Plc plunged 16 percent after forecasting a first-half loss because of higher fuel costs. Accor SA, Europe’s largest lodging company, slid 6.2 percent as sales trailed estimates.
The Stoxx Europe 600 Index fell 1.2 percent to 279.39 at the 4:30 p.m. close in London, extending yesterday’s 1.4 percent slide for the biggest two-day drop since August. The gauge has still advanced 1.3 percent so far this year as reports suggested the global economy is recovering and investors speculated that European leaders will increase their efforts to contain the region’s debt crisis.
National benchmark indexes retreated in 13 of the 18 western European markets. Germany’s DAX dropped 0.8 percent and the U.K.’s FTSE 100 sank 1.8 percent. France’s CAC 40 declined 0.3 percent.
China’s growth accelerated to 9.8 percent in the fourth quarter as industrial production and retail sales picked up, adding pressure on policy makers to keep raising interest rates.

U.S. stocks erased losses, rebounding from the biggest two-day decline since November, as Morgan Stanley’s revenue topping estimates overshadowed concern that China will raise interest rates and hamper global growth.
Morgan Stanley gained 4.7 percent, the most since July, after reporting revenue that beat analysts’ estimates. Home Depot Inc. rose 2.3 percent and homebuilders in Standard & Poor’s indexes added 1 percent after a report showed sales of previously owned American homes topped forecasts. Alcoa Inc. and Schlumberger Ltd. slid at least 0.8 percent following a slump in commodities prices on demand concern. Freeport-McMoRan Copper & Gold Inc. declined 4.1 percent after cutting forecasts for copper and gold sales.
The S&P 500 Index lost 0.1 percent to 1,281.22 at 2:17 p.m. in New York, trimming an earlier drop of 0.8 percent. The Dow Jones Industrial Average rose 3.67 points, or less than 0.1 percent, to 11,828.96.
Thirty of the 42 companies in the index that reported quarterly earnings since Jan. 10 have topped analysts’ predictions, according to Bloomberg data. Income grew 22 percent in the fourth quarter and will increase 14 percent in 2011, according to the average analyst projections. Sales topped estimates at 31 of 40 companies.

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