NEW YORK – U.S. stocks notched a gain for the sixth session in a row on Friday, while the euro faltered as gloomy Chinese economic data butted up against expectations policymakers could act to shore up the world’s economies.
Stock markets’ recent rally has been underpinned by comments by European Central Bank President Mario Draghi two weeks ago that the central bank was “ready to do whatever it takes to preserve the euro,” raising hopes of heavy bond buying to aid Spain and Italy.
The weakness in exports included a 16 percent drop in sales to Europe from a year ago.
“The data from China is concerning because the global economy is still the backdrop for the market. People are still very cautious because of the global growth concerns,” stated Paul Brigandi, vice president of trading at Direxion Funds in New York.
Some economists stated the Chinese central bank could move as early as this weekend to ease policy.
European shares closed lower but Wall Street recovered late in the day in thin trade. The euro headed for its first weekly drop against the dollar and yen in three weeks.
“It makes sense that we had take a bit of a breather, but momentum has been strong and the fact that we have held steady despite a lack of good news is a good sign the trend will continue,” stated Joe Bell, senior equity analyst at Schaeffer’s Investment Research in Cincinnati.
Equities markets were kept in check as the euro zone’s outlook remained in limbo.
Next week, second-quarter gross domestic product data is expected to show the euro zone economy contracted.
Hopes are high that the ECB will step in with bond buys to ease borrowing costs for Spain and Italy. But until details emerge – including the strings attached to any support – investors will be wary.
The euro struggled against the dollar as investors took a cautious stance. The currency fell 0.1 percent to $1.2290, off a one-month high of $1.2443 struck on Monday and falling to a one-week low of $1.2239.
“Despite what the ECB is saying, you are seeing risk sentiment reverse,” stated Lucy Lillicrap, senior risk consultant at global payments company AFEX Markets Plc in London.
The FTSEurofirst 300 index of top European shares ended down 0.1 percent, while the MSCI’s world equity index eked out a gain of 0.01 percent.
“After such a rally, people are tempted to book a bit of profit. It’s just healthy, investors are catching their breath,” stated Isabelle Enos, deputy head of asset management at B*Capital, in Paris.
The Dow Jones industrial average rose 42.76 points, or 0.32 percent, to 13,207.95. The Standard & Poor’s 500 Index added 3.07 points, or 0.22 percent, to 1,405.87. The Nasdaq Composite Index gained 2.22 points, or 0.07 percent, to 3,020.86.
In New York, shares of soccer club Manchester United were flat on their first day of trading. The stock ended at its offer price of $14.
U.S. Treasury debt prices benefited from investors looking for safety and the benchmark 10-year U.S. Treasury note rose 11/32 in price to yield 1.657 percent.
Fears of a new world food crisis were heightened on Friday by a U.S. government report that showed domestic and soybean crops have been slashed even more than expected by the worst drought in half a century and will fail to replenish ultra-low stockpiles.
Corn futures briefly touched another record high but closed lower as demand was scaled back.
CBOT December corn fell 1.8 percent to $8.09-1/4 a bushel after setting an all-time high of $8.49.
Oil markets were lower after China’s crude oil imports dropped in July and on weaker global oil demand forecasts by the International Energy Agency.
Brent crude settled 27 cents lower at $112.95 a barrel, while U.S. crude lost 49 cents to $92.87.
(Additional reporting by Marc Jones in London, Blaise Robinson in Paris, Ryan Vlastelica, Anna Louie Sussman and Gertrude Chavez-Dreyfuss in New York; Editing by Kenneth Barry)
- Big deal takes Kelly to Texas
- Trapattoni happy with selection policy
- Why People Think Services Are A Good Idea
- Manager Redknapp accused of using bank account in tax haven to evade tax on ...
- Soccer challenge winners advance
- Damascus girls soccer team to represent state in regional tournament
- Reuters Sports Schedule at 0600 GMT on Wednesday, Feb 29
- A 10-Point Plan for Injuries (Without Being Overwhelmed)
- From Alessandro Del Piero raising £184000 to Levski Sofia offering to house ...
- Overwhelmed by the Complexity of Businesses? This May Help
Submited by ethan - Comment RSS 2.0 - leave a comment - trackback