Wednesday 28th March 2012 |
Text too small? |
The latest data on US consumer confidence was slightly ahead of expectations, keeping alive optimism that the world's largest economy will expand at a clip to warrant the recent gain in stock prices.
In the US, the Conference Board’s confidence index slipped to 70.2 from a revised 71.6 reading in February that was higher than initially reported. That was just above the median forecast of economists surveyed by Bloomberg News for a decrease to 70.
On the housing front, the rate of decline in prices eased, underpinning hopes that this part of the economy might catch up to the recovery elsewhere. The S&P/Case-Shiller index of property values in 20 cities fell 3.8 percent from a year earlier, after dropping 4.1 percent in December. Prices were unchanged in January from December, the first time since July prices have not declined.
Optimism remains the prevailing sentiment on Wall Street as investors bet that expansion in the economy and corporate profits will accelerate, underpinned by a reassurance from Federal Reserve chairman Ben Bernanke yesterday that the US central bank will maintain its accommodative monetary policy stance.
"What we are seeing now is just natural buying and strong momentum. Money is moving away from other assets and into equities," Tim Ghriskey, chief investment officer at Solaris Asset Management in Bedford Hills, New York told Reuters.
"Technicians say there will be a pullback in the market but when everyone is looking for a pullback, it rarely happens. This is why money keeps pouring back in."
Money certainly keeps pouring into Apple as the stock climbed to yet another record today. Its chief executive is in China this week, seen as a bid to soothe concerns about work conditions for employees at key suppliers and address a lingering patent dispute.
In early afternoon trading in New York, the Dow Jones Industrial Average slipped 0.08 percent and the Standard & Poor's 500 Index edged 0.05 percent lower. The Nasdaq Composite Index rose 0.19 percent.
Also appealing was today's US government sale of US$35 billion in two-year securities. The offering drew a yield of 0.340 percent, compared with a forecast of 0.349 percent in a Bloomberg News survey of seven of the Federal Reserve’s 21 primary dealers. The bid-to-cover ratio was 3.69, versus an average of 3.53 for the past 10 sales.
The US Treasury will sell more debt later this week.
In Europe, the Stoxx 600 Index ended the session with a 0.5 percent decline for the day.
Among the big moves were shares in Total, which dropped 6 percent as a North Sea platform belonging to France’s largest oil producer leaked gas for a third day. Investors are worried about the costs that might be associated with the damage and clean-up.
“Total is a heavyweight in the indexes, so it has a lot of impact,” Lionel Heurtin, a fund manager at Ofi Asset Management in Paris, told Bloomberg. “The news reminds us of BP, so it’s normal to be cautious.”
(BusinessDesk)
BusinessDesk.co.nz
No comments yet
December 27th Morning Report
FBU - Fletcher Building Announces Director Appointment
December 23rd Morning Report
MWE - Suspension of Trading and Delisting
EBOS welcomes finalisation of First PWA
CVT - AMENDED: Bank covenant waiver and trading update
Gentrack Annual Report 2024
December 20th Morning Report
Rua Bioscience announces launch of new products in the UK
TEM - Appointment to the Board of Directors