While you were sleeping: BusinessWire overnight wrap

Tuesday 30th December 2008

Stocks on Wall Street fell, with Dow Chemical Co. slumping 20% after funding for its takeover of Rohm & Haas Co. fell through. Oil companies rose after the price of oil advanced on tensions in the Gaza Strip.

The Dow Jones Industrial Average declined 0.8% to 8446.57 and the Standard & Poor's 500 Index slipped 0.7% to 866.6. The Nasdaq Composite fell 1.6% to 1505.09.

Dow Chemical fell US$3.45 to US$15.48 after Kuwait scrapped a proposal that would have provided US$9 billion to fund a merger with Rohm & Haas, down 15% in New York.

Chevron rose 1.3% to US$71.30 after crude oil gained.

Ford Motor fell 5.2% to US$2.17 after billionaire investor Kirk Kerkorian sold the remaining shares in the automaker owned by his investment firm Tracinda Corp. General Motors fell 5.5% to US$3.47.

Middle East tensions helped drive down the U.S. dollar against the euro as some traders fretted about disruptions to oil supplies. The British pound fell to a record low against the euro after a survey showed U.K. house prices may extend their slide in 2009.

The dollar fell to $1.4062 per euro in New York, from $1.4028. The greenback dropped to 90.38 yen from 90.81.

Israeli air strikes in the Gaza Strip also helped stoke demand for U.S. Treasuries as a haven from escalating tensions and weakening shares.

The yield on two-year Treasuries fell 15 basis points to 0.73%, edging closer to the record low yield of 0.6% reached on Dec. 17. The yield on 10-year government debt fell 7 basis points to 2.1%.

In Europe, stocks gained led by banks and oil companies after a report that Royal Bank of Scotland will abandon the sale of its insurance unit and tensions stayed high in the Middle East.

The Dow Jones Stoxx 600 Index rose 0.2% to 193.46 and has declined a record 47% this year.

Royal Bank of Scotland gained 14%, leading the FTSE 100 Index up 2.4% to 4319.35. Cairn Energy rose 7.1%.

Germany's DAX 30 rose 1.6% to 4704.86 as Postbank jumped almost 10% and Deutsche Bank gained 5.7%. In France, the CAC 40 rose 0.5% to 3130.72.

Crude oil rose after Israeli Defense Minister Ehud Barak said the Middle Esat nation is fighting a "war to the death" with Hamas, which gets support from Iran.

Crude for February delivery rose 6.1% to $40.01 a barrel on the New York Mercantile Exchange.

Gold climbed to the highest level in almost two months on increased demand for the precious metal as a haven. Gold futures for February delivery rose 0.5% to US$875.30 an ounce in New York.

Copper rose as the U.S. dollar weakened, leading a 1.3% gain in the Reuters/Jefferies CRB Index of 19 raw materials. Copper gained 2.1% to US$2,905 a metric ton on the London Metal Exchange.

(Businesswire.co.nz)

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