U.S. MARKETS, ECONOMIC INDICATORS
Stock markets were closed for a second day Tuesday, in the aftermath of superstorm Sandy. As investors assessed the damage from the storm, stock futures indicated a slight rise from where stocks traded Friday after a positive reading on U.S. housing data and encouraging economic news in Europe.
Gold futures locked in modest gains as trading volumes remained subdued in the aftermath of Hurricane Sandy.
Trading in stock futures ended at 9:15 a.m. EDT, as scheduled. Millions in the eastern U.S. were left without power, with a Consolidated Edison official saying it could take up to a week to restore power to the bulk of Manhattan. Estimates for the financial impact of the storm are running into the billions of dollars.
At the close of morning futures trading, Dow Jones Industrial Average futures had gained eight points from Friday's level, or 0.1%, to 13062. Dow futures had been down as much as 1% in overnight trading.
Standard & Poor's 500-stock index futures rose about 3.5 points, or 0.3%, to 1411.10. Nasdaq 100 futures lost 3.75 points, or 0.1%, to 2655.25.
On a sparse economic data calendar, the S&P/Case-Shiller index of 20 major metropolitan areas for August was in line with expectations. Home prices in 20 major cities continued to post gains in August, the latest indication that the U.S. housing market is improving.
A reading from the Conference Board on October's Consumer Confidence index was delayed until Thursday.
In corporate news, a feud between Apple executive Scott Forstall and other company executives came to a head. Mr. Forstall was asked to leave the company after refusing to sign a letter apologizing for problems with the company's new mapping service. There was no premarket stock trading.
Ford Motor reported third-quarter earnings and revenue that exceeded analyst expectations as a strong performance in North America offset losses suffered in Europe.
EUROPEAN STOCK MARKETS
European stock markets staged broad-based gains Tuesday, as investors digested a fresh round of corporate results, with the financial and energy sectors in the lead after well-received earnings from UBS AG and BP PLC.
The Stoxx Europe 600 index rose 0.9% to close at 271.76. Swiss investment bank UBS rose 5.9% after it said it would reorganize its investment-banking arm in a response to tougher regulatory and economic climate.
It further confirmed it will slash about 10,000 jobs by 2015, as it reported a 2.2 billion Swiss francs ($2.35 billion) loss in third quarter from a 1.02 billion francs profit last year. Deutsche Bank AG rose 4.5%.
The German bank reported a 3% rise in third-quarter profit, beating analysts' expectations. Oil group BP put in its best daily performance since last November, gaining 4.2%, after third-quarter profit rose 7.8% to $5.43 billion, topping analysts' estimates.
For the broader European stock markets, investors also looked to Spain, where preliminary data showed the Spanish economy shrank less than expected in third quarter, with gross domestic product declining 0.3%.
The IBEX 35 index rallied 1.4% to 7,833.90, with Banco Santander SA rising 2.2%. Macro-economic data was also in focus in Germany, where unemployment rose twice as much as predicted by economists.
Among notable stock movers in Europe, insurance firms recovered from the prior day's losses when potential Sandy-related losses were on investor's minds. Swiss Re AG rose 1.1%, Munich Reinsurance Company added 0.6% and Zurich Insurance Group AG gained 0.4%. Germany's multi-line insurance firm Allianz SE picked up 2.5%, after it late Monday raised its operating profit guidance for the full year.
Bayer AG climbed 1.7% is it announced the acquisition of U.S. vitamins maker Schiff Nutrition International Inc. for about $1.2 billion. The DAX 30 index gained 1.1% to 7,284.40. Elsewhere, energy firms posted some of the biggest gains, tracking oil prices higher. France's Total SA rose 1.6%.
The CAC 40 index gained 1.5% to 3,459.44. The U.K.'s Royal Dutch Shell PLC gained 1.2%. Miners also rose amid higher metals prices. Kazakhmys PLC added 2.4% and Rio Tinto PLC gained 2%. The FTSE 100 index rose 1% to 5,849.90.
The Bank of Japan announced that it would extend its asset purchasing program just before the Nikkei closed, which resulted in the market ending down 1% at 8841.98 after staying in positive territory for most of the session.
Nomura Holdings lost a large chunk of its early gains, finishing up 1.4%. More broadly, markets were looking ahead to manufacturing data from China and nonfarm payrolls figures from the U.S., both due out later in the week.
Hong Kong's Hang Seng Index fell 0.4% to 21428.58, as large Chinese banks declined ahead of earnings reports coming out after the market closed. Industrial and Commercial Bank of China fell 1.8% and Bank of Communications was 1.2% lower.
BYD slid 4.1% in Hong Kong after the battery and carmaker said that it expects its full-year net profit to fall by up to 98% after reporting a 94% drop in third quarter net profit. The Shanghai Composite Index was up 0.2% at 2062.35. South Korea's Kospi Composite was 0.4% higher at 1899.58.
After rallying Monday in anticipation of Hurricane Sandy, gasoline futures retreated Tuesday on concerns about lower energy consumption.
Gasoline futures settled at $2.729 a gallon, down 2.8 cents, or about 1%. Front-month U.S. crude futures for December delivery jumped 14 cents, or 0.2%, to settle at $85.68 a barrel.
Brent futures were 54 cents lower at $108.90 a barrel. Analysts said the greater concern was over lower gasoline consumption due to the effects of Hurricane Sandy across a wide swath of the U.S.
They also said the lower gasoline prices were a sign that the market believes the East Coast refineries that shut down, or scaled back production, emerged from the storm without significant damage.
Gold futures locked in modest gains as trading volumes remained subdued in the aftermath of Hurricane Sandy. The most actively traded contract, for December delivery, settled up $3.40, or 0.2%, at $1,712.10 a troy ounce on the Comex division of the New York Mercantile Exchange. COMPILED FROM MORRISON SECURITIES PTY. LTD
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