Wall Street Wrap for 12 August 2010

Wall Street Wrap for 12 August 2010

New York: US stocks continued their downward descent on Thursday, with the Dow Jones, S&P 500 and the Nasdaq all ending lower over .5%.

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Government reports showed an unexpected hike in Americans filing for unemployment insurance, increasing 2,000 to 484,000 filing for claims, in the week ended 7 August. While companies have added workers for 7 straight months, firings have remained high, as the economic recovery still looks uncertain.

In corporate news, General Motors Co., the car company that’s 61% owned by the US, is looking to raise $12 billion to $16 billion in an IPO. In addition, the company announced it had another profitable quarter of $1.3 billion in earnings. This is in stark contrast to the $12.9 billion it lost in the same period last year when the company went into bankruptcy.

Cisco Systems reported healthy earnings with a jump in Q2 profit of 79%, but missed analysts’ sales targets. Sales rose 27% to $10.84 billion, while analysts estimated $10.88 billion. CEO John Chambers said he is confident that the company would continue growing, but added that the economy has been sending “mixed signals" to its customers. Shares were down as much as 10% in early trade, and ended for the day.

Other market movers for the day included Citigroup, Intel, and Ford Motor.

In other news, Make My Trip, the largest Indian travel portal, priced its US IPO on the Nasdaq at the top end of the range at $14, ending the day at $26, up almost 90%. The IPO was the first by an Indian company since 2006, and raised $70 million. However, the company has never turned a profit in its 10-year history.

Economic worries abroad continued to hamper Asian markets, with the Nikkei, Hang Seng and Shanghai Composite falling between .9% - 1.25%. European markets ended the day mixed.

In commodities, oil for September delivery fell $2.28 to $75.74 a barrel, while gold for December delivery rose $17.50 to $1,216.70 an ounce.

In bonds, the yield on the 10-year note increased to 2.73% from 2.72% late Wednesday.