News that North Korea’s leader, Kim Jong il, had died, weighed on Asian markets amid concern for the region’s stability. South Korean shares tumbled, with the Kospi closing down 3.4%, after dropping as much as 4.9%. The Nikkei lost 1.3% to 8296, the ASX 200 dropped 2.4%, and the Hang Seng shed 1.2%. China’s Shanghai Composite outperformed, easing a mere .3%, as it erased an earlier drop of 2.6%.
European markets traded mixed, following a speech by ECB president, Mario Draghi, in which he offered no new stability plans. The DAX fell .5%, and the FTSE lost .4%, while the CAC40 inched up fractionally.
US stocks opened higher, but closed significantly lower. The Dow fell 100 points to 11766, the Nasdaq dropped 1.3%, and the S&P 500 declined 1.2%.
Currencies
The Dollar traded modestly higher against world currencies, in a light session. The Euro dropped .4% to 1.2996, the Pound declined .3% to 1.5498, and the Yen fell .4% to 78.04. The Australian Dollar sank .8% to .9888.
Economic Outlook
The NAHB housing market index rose from 19 to 21 last month, in line with expectations, posted its 3rd straight gain. Additional housing data is due on Tuesday, when the government will release reports on housing starts and building permits.
Western Markets Soar on Upbeat Data
Equities
Asian markets traded mixed as the region calmed following Monday’s slide. Korean shares partially recovered from Monday’s slide, gaining .9%, and the Nikkei rose .5% to 8336, led by a 155 jump in Olympus shares. The ASX 200 slid .2%, the Shanghai Composite slipped .1%, while the Hang Seng edged up fractionally.
European markets surged, boosted by impressive US housing data, and a jump in German business sentiment. The DAX jumped 3.1%, the CAC40 rallied 2.7%, and the FTSE climbed by 1%. The automobile sector advanced by 5.1%, lifted by the bullish outlook. A Spanish short-term debt auction saw yields drop sharply from a month ago, a positive sign for the debt crisis.
The S&P 500 Surges 3%
Jefferies shares rocketed 23% higher after reporting earnings which far exceeded analyst expectations.
Currencies
The Australian Dollar soared 1.8% to 1.0075 as investors switched to “risk on”. The Pound climbed 1% to 1.5659, the Canadian Dollar gained .8% to 1.0300, and the Euro rose by .6% to 1.3078.
Economic Outlook
Housing starts and building permits both rose by 50K, far better than the 10K gain forecast by analysts, a strong sign that the housing market is on the rebound.
ECB Offers 489 Billion Euro Liquidity Boost
Equities
Asian markets advanced on Wednesday, buoyed by strong Tuesday’s outstanding US housing data. The Nikkei gained 1.5% to 8460, the Kospi jumped 3.1%, and the ASX 200 rallied 2.1%. Hong Kong’s Hang Seng climbed 1.9% to 18416, while China’s Shanghai Composite bucked the uptrend, sliding 1.1% to 2191.
European markets declined, as a morning spike faded. The DAX fell 1% to 5792, the CAC40 dropped .8% and the FTSE declined .6% to 5390. The ECB offered 489 billion euros in 3-year notes, in an effort to increase liquidity to struggling banks.
Germany's DAX Slides 1%, Erasing Morning Gains
US markets closed mixed as the Nasdaq dropped 1%, while the S&P 500 gained .2%, and the Dow inched up 4 points.
Currencies
The major currencies swung widely in a volatile session, as the ECB’s efforts triggered a brief dollar selloff which quickly reversed. The Euro closed down .3% to 1.3048, after spiking as high as 1.3188 earlier in the day. The Australian Dollar rose by .2% to 1.0092, the Pound edged up .1% to 1.5676. and the Canadian Dollar settled up .3% to 1.0263.
Economic Outlook
Existing home sales rose by much less than forecast, climbing to 4.42M from 4.25M, as opposed to a forecast of 5.04 million.
Weekly Jobless Claims Drop to 3.5 Year Low
Equities
Asian markets traded lower, as the ECB’s liquidity efforts failed to inspire confidence amongst investors. The Nikkei dropped .8% to 8395, and the Kospi edged down fractionally. Australia’s ASX 200 slumped 1.2% as retailers continue to slash their outlook for the first quarter, due to weak Christmas sales. In greater China, the Hang Seng and Shanghai Composite both declined .2%, but were well-off their earlier lows.
In contrast, European markets rallied, led by banks, which gained 2%. The CAC40 climbed 1.4%, the FTSE gained 1.3%, and the DAX advanced 1.1%.
France's CAC40 gains1.4% as European Banks Rally
US markets closed higher as well, boosted by upbeat economic data. The Dow gained 62 points to 12170, while the Nasdaq and S&P 500 both rose .8%.
Micron Technology shares jumped 15.7%, as upbeat sales data outweighed concerns over lower than expected profits. Meanwhile, Bed Bath & Beyond shares slid 6.3% after issuing a weak outlook.
Currencies
The Pound, Euro, and Swiss Franc all ended little changed from their Wednesday settlement prices, closing near the center of their intraday price range. The Canadian Dollar climbed .6% to 1.0208, and the Australian Dollar gained .4% to 1.0130, as traders moved back into “risk on” mode. The Yen eased .2% to 78.17.
Economic Outlook
3rd quarter GDP was revised downward to 1.8% from 2.0%, showing the economy is growing slowly, but steadily. Weekly jobless claims fell to 364K, 12K better than expected, hitting their best level since 2008. Consumer confidence moved up to 69.9 from 67.7, better than forecast.