While you were sleeping: Greenback dips against yen, US stocks fall

Monday 28th September 2009

The yen rose to a seven-month high against the US dollar on Friday after Japan’s new government said it won’t pursue a policy of seeking a weaker currency and the Group of 20 nations pledged to maintain emergency stimulus measures until a recovery takes hold.

Japan’s Finance Minister Hirohisa Fujii reiterated to reporters at a G-20 briefing that the nation would refrain from trying to drive the yen lower.

The dollar weakened 1.8% to 89.63 yen on Friday while the euro sank 1.6% against Japan’s currency. The euro edged up 0.2% to US$1.4686.

US stocks fell for a third straight day on Friday after Research In Motion, the maker of Blackberry devices, posted results that disappointed some investors, while figures for housing and durable goods were weaker than expected.

The Dow Jones Industrial Average fell 0.4% to 9665.19 and the Standard & Poor’s 500 declined 0.6% to 1044.38. The Nasdaq Composite fell 0.8% to 2090.92.

Shares of Research In Motion tumbled 17% percent to US$68.91, driving the Nasdaq lower, after posting quarterly revenue that missed estimates and gave an outlook that failed to arouse optimism.

Wal-Mart Stores fell 2.4% to US$49.47 and Alcoa Inc., the aluminium producer, fell 3.2% to US$13.08, leading the Dow lower.

Demand for US durable goods fell last month, surprising economists and raising questions about the pace of recovery in the world’s biggest economy.

Orders for long-lasting goods fell 2.4% in August, the biggest decline since January, according to the Commerce Department.

The data prompted Morgan Stanley to lower its forecast for third-quarter growth to 3.2% from 3.7%.

Sales of new homes rose 0.7% to a lower-than-expected annual pace of 429,000 last month, the Commerce Department said.

The median price of a new house fell 9.5% to US$195,200 in August from July, the biggest monthly decline since the department began tracking prices in 1963 and the lowest since 2003.

Looming for the US housing market, the Obama administration’s US$8,000 tax credit for first-time buyers is due to expire at the end of November.

Homebuilder KB Home tumbled 8.5% to US$16.96 after posting a worse-than-expected quarterly loss and said it doesn’t see a turnaround anytime soon.

Shares also fell in Europe after the US durable goods data. The Dow Jones Stoxx 600 fell 0.4% to 238.95, led by lenders.

Credit Suisse sank 1.7%, Barclays Plc fell 2.1% and UBS AG declined 1.7%.

Julius Baer Holding, the Swiss wealth manager, fell 5.6% after disappointing investors in its strategy update.

Among regional benchmarks, the UK's FTSE 100 rose 0.1% to 5082.20, Germany’s DAX 30 fell 0.4% to 5581.41 and France’s CAC 40 declined 0.5% to 3739.14.

Crude oil edged higher on Friday as Iran disclosed it has a second uranium enrichment plant, drawing condemnation from the US and other leading nations. A Reuters/University of Michigan survey which showed US consumer sentiment rose this month also helped improve sentiment for crude.

US crude futures rose 13 cents to US$66.02, up 13 cents.

President Barack Obama said the US, the UK and France had been given evidence that Iran has been constructing a “covert uranium facility” for several years.

Gold futures for December fell 0.7% to US$991.60 an ounce in New York.

Copper futures for December delivery rose 1.1% to US$2.7405 a pound on the New York Mercantile Exchange.

Businesswire.co.nz

Comments from our readers

No comments yet