Sharechat Logo

While you were sleeping: BusinessWire overnight wrap

Thursday 7th August 2008

Text too small?
Technology stocks, spurred by Cisco Systems, and another slide in the price of oil led to a rally on Wall Street on Wednesday, which pushed the benchmark indices to their highest levels since early July.

Cisco, the biggest maker of networking equipment, climbed as its sales forecast allayed concern business is deteriorating. Microsoft added another boost to the tech sector after analysts at UBS forecast that the largest software company might buy back up to $20 billion in stock.

The Dow Jones industrial average added 40.30 points, or 0.35%, at 11,656.07. The Standard & Poor's 500 Index rose 4.31 points, or 0.34%, at 1,289.19. The Nasdaq Composite Index gained 28.54 points, or 1.21%, at 2,378.37.

US light crude fell 59¢ to settle at $118.58 a barrel after hitting a low of $117.11, the lowest since early May and off a record $147.27 that was struck on July 11. London Brent crude fell 92¢ to $116.78 a barrel.

Rising US crude inventories provided more evidence of a demand slowdown in the world's top consumer that's chopped $30 off the price of oil since it set an all-time high in July.

Oil's sharp fall helped overshadow the deep morass in housing, made visible again on Wednesday when home finance company Freddie Mac posted an unexpectedly wide loss.

Freddie Mac said it would set aside twice as much money for bad loans and slash its dividend at least 80%. Freddie Mac's shares fell more than 19%, while those of bigger rival Fannie Mae declined nearly 15%.

European stocks rose in relatively calm trade with banks gaining ground after BNP Paribas delivered earnings that were better than expected and commodity shares rallied on Xstrata's $10 billion bid for Lonmin.

The FTSEurofirst 300 index of top European shares closed 0.9% higher at 1192.99 points, tapping a seven-week closing high.

Dollar's Strength

The US dollar rose for a fourth straight day to a seven-month peak versus the yen and a six-week high against the euro on Wednesday, as the slide in oil prices to a new three-month low raised hopes economic growth would pick up and inflation would subside.

The dollar raced to 109.71 yen, its highest level since early January, according to Reuters data. It was last trading at 109.60 yen, up 1.2% on the session. The dollar was on track for its highest daily gain versus the Japanese currency in three weeks.

A Reuters poll of 61 strategists taken August 4-6 showed most expect the euro to trade at around $1.54 over the next three months, before retreating to $1.50 in six months and $1.44 a year from now.

On Wednesday, the US government sold $17 billion in 10-year notes, awarding 3.35 % of the bids at the high yield of 4.075 %. The ratio of bids received to those accepted was 2.61.

Benchmark 10-year Treasuries were down 5/32 in price at 98-21/32. Their yield, which moves inversely to the price, rose to 4.04 % from 4.02 % late Tuesday.

Short-dated Treasuries fared better than longer maturities, supported by the view that the Fed was in no hurry to raise interest rates.

Two-year notes slipped 1/32 in price, their yields rising to 2.58 % from 2.56 % late on Tuesday. Five-year notes slipped 2/32 in price, their yields rising to 3.32 % from 3.30 % late Tuesday.

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

30th November 2021 Morning Report
Serko Limited (NZX: SKO) Announces Opening of NZ$10 Million Retail Offer
Rua Bioscience Limited (NZX: RUA) Rua to Accelerate Growth with Proposed Acquisition of Zalm
The New Zealand Refining Company Limited (NZX: NZR) Successfully Completes Placement
NZME Limited (NZX: NZM) Acquires BusinessDesk to Supercharge Digital Growth
Cannasouth Limited (NZX: CBD) Acquisition of Outstanding Stake in Cultivation JV Complete
Geneva Finance Limited (NZX: GFL) Half Year Results
The New Zealand Refining Company Limited (NZX: NZR) NZ announces equity raising
Asset Plus Limited (NZX: APL) Result for the six months ended 30 September 2021
Me Today Limited (NZX: MEE) 30 September 21 Results and Conditional Placement