Global Markets Overview - 12 February 2013

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By Christine Gaylican | February 12, 2013 11:26 AM EST

U.S. STOCKS, BONDS

Declines in energy stocks helped push major benchmarks lower, a soft patch that follows the Standard & Poor's 500-stock index's longest stretch of weekly gains since August.

The Dow Jones Industrial Average slipped 35 points, or 0.3%, to 13957 points in afternoon trading. The Standard & Poor's 500-stock index shed three points, or 0.2%, to 1515, stepping back from its Friday advance to a five-year high, which capped the benchmark's sixth straight weekly gain.

The Nasdaq Composite Index fell eight points, or 0.2%, to 3186. Energy shares in the S&P 500 led losses across eight of the index's 10 sectors.

The financial and utility groups rose. Google fell 1% after the Internet search giant's executive chairman, Eric Schmidt, said in a filing that he plans to sell stock valued at $2.5 billion over the next year as he looks to cut his stake in Google by more than 40%.

U.S.-listed shares of Novo Nordisk, based in Denmark, tumbled 13% after the U.S. Food and Drug Administration said it needed more trial data before it could approve the company's new insulin drug.

Starz rose 8% after extending its pay-television agreement with Sony's film business by five years. Rival Netflix fell 2.5%, and was the worst-performing stock on the S&P 500.

Shallow losses on Monday come after what has been a mostly unfettered run higher for U.S. stocks over the past three months. Apple rose 1.5%, putting the stock on track to rise for a third consecutive session, which would be its longest streak of gains since Nov. 26. The company is testing a watch-like device that would perform some functions of a smartphone.
 
Novo Nordisk AS knocked the air out of Europe's benchmark stock index Monday after a setback in the U.S., while the region's bourses saw mixed trade as a meeting of euro-zone finance ministers got under way.

EUROPEAN STOCK MARKETS, BONDS

The Stoxx Europe 600 index dropped 0.6% to close at 285.62. Among notable movers in Europe, shares of Danish drug maker Novo Nordisk, the world's largest insulin maker, slumped 13.2% after the U.S. Food and Drug Administration declined to approve its new-drug applications for insulin Tresiba and a related product, Ryzodeg.

The FDA requested additional cardiovascular trial data, which Novo Nordisk doesn't expect to be able to provide during 2013. The setback for Novo Nordisk helped send French rival Sanofi SA 3.4% higher, as the two firms have been competing to dominate the lucrative insulin market.

Additionally, Sanofi announced its intention to purchase a piece of Regeneron Pharmaceuticals Inc. Shares of Dutch food retailer Royal Ahold NV jumped 3.8%.

Sweden's Hakon Invest AB said it would buy the 60% of shares it doesn't own in Nordic food retailer ICA for 20 billion Swedish kronor ($3.11 billion) from the Dutch company. Shares of Hakon Invest soared 16.5% in Stockholm.

Monday was light on the data calendar for Europe, with attention falling on the meeting of euro-zone finance ministers, known as the Eurogroup, in Brussels, where an aid package for Cyprus and an evaluation of Greece's progress in its rescue program were likely to top the agenda. Investors also looked ahead to the Italian election on Feb. 24-25.

Polling there has been banned with less than 15 days to go, but former prime minister Silvio Berlusconi had in recent polls narrowed the gap to center-left politician Pier Luigi Bersani, leaving markets worried that a strong showing by Berlusconi's center-right coalition would derail Italy's reformist drive. The FTSE MIB index dropped 0.6% to 16,529.87.

Elsewhere, the U.K.'s FTSE 100 index rose 0.2% to 6,277.06, France's CAC 40 index closed slightly higher at 3,650.58, and Germany's DAX 30 index fell 0.2% to 7,633.74.

ASIA-PACIFIC STOCK MARKETS, BONDS

The Australian share market consolidated recent strong gains ahead of key events this week, including domestic earnings reports, a European finance ministers' meeting, and the U.S. State of the Union address by President Barack Obama.

In addition, Lunar New Year holidays in China are expected to make for relatively thin and cautious trading over the next few days. Markets in China, Hong Kong, Japan, Malaysia, Singapore, South Korea, Taiwan and Vietnam were shut Monday for holidays. Australia's S&P/ASX 200 was down 0.1%.

The focus was mainly on the retail sector, with JB Hi-Fi soaring 17.2% on stronger-than-expected earnings, dividend and outlook statements, while Harvey Norman rose 7.0% on the back of the strength in JB Hi-Fi. Elsewhere in the region India's Sensex was flat, the Philippines' PSE Composite rose 0.4%, Indonesia's JSX advanced 0.4% and Thailand's SET index gained 0.2%.

COMMODITIES
 
Base metals mostly closed lower on the London Metal Exchange Monday, dented by a lack of buying interest as top metals consumer China commenced a week-long public holiday. At the PM kerb close, LME three-month copper was down 1.1% at $8,199 a metric ton.

Tin held up the best, ending the session flat at $24,850/ton. Oil futures rose Monday to finish above $97 a barrel for the first time in more than a week. A rally in the euro undermined some of the dollar's earlier strength which, in turn, provided support for dollar-denominated oil prices.

March crude rose $1.31, or 1.4%, to settle at $97.03 a barrel on the New York Mercantile Exchange, the highest settlement since Feb. 1.

Gold fell to the lowest price in more than a month, as the start of a weeklong holiday in major consumer China kept potential buyers at bay. The most actively traded contract, for April delivery, fell $17.80, or 1.1%, to settle at $1,649.10 a troy ounce on the Comex division of the New York Mercantile Exchange, the lowest settlement since the Jan. 7 settle of $1,646.30. COMPILED FROM MORRISON SECURITIES PTY. LTD.

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