Tuesday, April 7, 2009

Foreign Market Industry Also Led To The Selling Pressure - April 07, 2009

Monday, the US stock markets closed lower as investors booked profits following a four-week rally in more than 75 years. Further amid doubts over the health of the banking industry also led to the selling pressure. But the markets managed to recoup some losses from the early lows as some buying was seen in the afternoon trade.

The Dow Jones Industrial Average (DJIA) dropped by 41.74 points to close at 7,975.85. The NASDAQ Composite (RIXF) index decreased by 15.16 points to close at 1,606.71 and the S&P 500 (SPX) fell by 7.02 points to close at 835.48.

The major indices spent the entire session in the red underpinned by the financial sector. Financials were put under pressure when a reputable analyst from Calyon Securities gave a pessimistic analysis of the banking industry by stating that banks'' loan losses relative to their total loans should increase to levels that exceed those of the Great Depression.

Sun Microsystems logged one of their worst performances on record by shedding more than one-fifth of their market cap this session on reports the company merger talks with IBM could be coming undone. This has led the technology stocks sold off.

US light crude oil for May delivery fell by 4.9% to settle at $49.95 a barrel on the New York Mercantile Exchange. The crude prices contracts closed below the $50 mark mainly due to higher dollar and increase in supplies.

Gold futures for the month of June delivery finished the session at $872.80 per ounce, down by 2.7%. The crude prices remained in pressure for the third consecutive session.

Today major stock markets in Asia are trading mixed. Hang Seng and Straits Times index are trading lower by 169.04 and 39.78 points at 14,829 and 1,808.20 respectively. However, Shanghai composite is up by 8.5 points at 2,428.28, followed by Japan’s Nikkei and Seoul Composite index which are higher by 10.52 and 4.81 points at 8,868.45 and 1,302.66 respectively.

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