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While you were sleeping: Stocks steady, yen drops

Thursday 11th March 2010

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Global equities were steady overnight ahead of the latest series of data on the Chinese economy, while the yen fell sharply on expectations the Bank of Japan was preparing to ease monetary policy.

Shortly after midday, the Dow Jones Industrial Average had edged 15.87 points, or 0.15%, lower to 10,548.51. The Standard & Poor's 500 Index was up 1.73 points, or 0.15%, at 1142.18. The Nasdaq Composite Index was up 10.82 points, or 0.46%, at 2351.50.

The Chicago Board Options Exchange Volatility Index, or VIX, which is known as Wall Street’s ‘fear gauge’ rose 1.56% to 18.20.

Among the decliners were Chevron Corp, Cisco Systems Inc and Caterpillar Inc. Newmont Mining Corp also slid, in part taking its lead from falling commodities prices.

In Europe overnight, the Dow Jones Stoxx 600 increased 0.6% to 258.24.

Among national benchmarks, The UK’s FTSE 100 gained 0.7%, while Germany’s DAX and France’s CAC 40 each rose 0.9%.

China reported that its exports increased more than forecast last month and property prices accelerated at their fastest pace in almost two years.

Tonight China will release its latest price data. Inflation may have accelerated to 2.5%, the fastest pace in 16 months, according to the median estimate in a Bloomberg News survey of economist.

The Dollar Index, which measures the greenback against a basket of six major currencies, fell 0.11% to 80.50.

The yen fell against most major currencies overnight after Reuters reported talk of a potential easing of interest rates by the Bank of Japan.

Midway through the New York trading day, the U.S. dollar was up 0.7% versus the yen at 90.61 yen after climbing as high as 90.82, according to Reuters data.

The yen was down 1.2% against the Canadian dollar, 1.3% against the Swiss franc, 1.3% against the euro and 0.7% against the pound.

Bank of America-Merrill Lynch cut its forecasts for the yen, saying Japanese Finance Minister Nato Kan has a “stronger resolve” to temper gains in the currency than did his predecessor, according to Bloomberg.

Bank of America said the yen would trade at 85 per dollar by the end of March, compared with its previous target of 83, and reach 87 by the end of June, weaker than its earlier forecast of 86, Tomoko Fujii, senior currency strategist at the U.S. bank, wrote in a research note overnight.

Sentiment toward the U.S. dollar climbed to 66.39 this month from 55.72 in February, according to a Bloomberg survey. The measure is a diffusion index, meaning a reading above 50 indicates Bloomberg users expect the dollar to strengthen.

Sterling was down 0.1% at US$1.4986, after falling to its lowest since March 2. The Australian dollar rose to a seven-week high against the greenback, while the New Zealand dollar rose to a five-week high.

The euro rose 0.5% to US$1.3672.

The Reuters/Jefferies CRB Index, which tracks 19 raw materials, fell 0.46% to 273.52.

Gasoline stocks in the world's largest energy market showed a surprise drop of 2.9 million barrels to 229 million barrels last week, the U.S. Energy Information Administration (EIA) reported overnight.

And U.S. commercial crude oil stockpiles rose 1.4 million barrels to 343 million barrels in the week to March 5 - below the 1.9 million barrels rise that analysts had been expecting.

US crude for April delivery was up US$1.29 at US$82.78 by 1629 GMT. London ICE Brent for April gained US$1.28 to US$81.19.

Platinum rose to seven-week highs at US$1614.50 an ounce, chasing gains in palladium, which climbed to a two-year high late last week.

Spot gold was bid at US$1121.80 an ounce at 1624 GMT, against US$1121.15 late in New York on Tuesday. US gold futures for April delivery on the COMEX division of the New York Mercantile Exchange were flat at US$1122.10 an ounce.

 

 

 

Businesswire.co.nz



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