Wall Street rebounds after 6 days of losses

Wall Street rebounds after 6 days of losses
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First Published: Fri, Nov 25 2011. 11 06 PM IST

Updated: Fri, Nov 25 2011. 11 06 PM IST
New York: US stocks rose on Friday after six days of losses, but the market was still headed for its worst week in two months on crimped holiday trading and fear that Europe’s debt crisis lacked an unified response.
The euro hit a seven-week low against the dollar and looked to weaken further as Italy’s borrowing costs spiraled on worries over disagreement on how to tackle the debt crisis. The dollar climbed to a nearly eight-month high against the Swiss franc.
Fewer participants after Thursday’s US Thanksgiving holiday thinned volume in almost every market. US Treasuries prices were down, while commodities were mixed, with oil , copper up and gold down.
“It’s hard to qualify today as even a trading session, considering there is hardly anybody here to trade,” said Kevin Kruzenski, head of listed trading at KeyBanc Capital Markets in Cleveland.
Stocks across Wall Street, Europe and other major exchanges were on course for their worst week since 25 September after a European Union conference in Strasbourg produced little to soothe the markets’ fears.
“The markets are going to continue to pressure the EU until they come up with a solution that is going to ease the crisis,” said Peter Cardillo, chief market economist at Rockwell Global Capital in New York.
French President Nicolas Sarkozy and German Chancellor Angela Merkel, after talks with Italian Prime Minister Mario Monti on Thursday, agreed only to stop bickering in public over whether the ECB should do more to resolve the crisis.
An hour before the close of a shortened session, the Dow Jones industrial average was up 17.07 points, or 0.15%, at 11,274.62. The Standard & Poor’s 500 Index was up 1.47 points, or 0.13%, at 1,163.26. The Nasdaq Composite Index was down 7.08 points, or 0.29%, at 2,453.00.
The S&P had closed down for six consecutive sessions, setting itself up for a loss of nearly 4% on the week.
“The market is oversold and there are some people hopeful of the shopping season and major retail stocks, but the overall sentiment is still weak. I wouldn’t be surprised if the S&P tested the 1,150 level next week when traders get back to their desks,” said KeyBanc Capital’s Kruzenski.
The benchmark 10-year US Treasury note was down 21/32 in price, its yield at 1.96% versus Wednesday’s close of 1.88%.
European stocks rose after falling in six previous sessions. The FTSEurofirst 300 index of top European was up 0.9% on the day but headed for a near-5% loss on the week.
Italian two-year government bond yields rose above 8% while the interest rate premium investors charge Italy to borrow over 10% compared with equivalent German debt continued to rise despite reported buying by the European Central Bank.
German Bund futures also extended losses, reinforcing fears that debt contagion is starting to hurt the region’s soundest economy. Bund futures hit a session low of 134.27, continuing to fall after a sharp sell-off in the wake of a weak 10-year bond auction on Wednesday.
World stocks, indicated by the MSCI All-World index were up 0.03% on the day and down almost 5% on the week.
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First Published: Fri, Nov 25 2011. 11 06 PM IST
More Topics: Markets Update | USA | Stocks | Dow Jones | Nasdaq |