Indian ADRs end in a mixed mode
US stocks fell on Tuesday, 06 May 2014. Selling of U.S. stocks accelerated early Tuesday afternoon. Even deal news, generally a positive for the market, failed to lift prices. The major indices remain pinned near their lows for the day, held down by a relatively weak showing from the financial, consumer discretionary and technology sectors.
The Dow Jones Industrial Average dropped 129.53 or 0.8% to 16,401.02. The Nasdaq Composite finished the day 57.30 points, or 1.4%, lower at 4,080.76. The S&P 500 ended the day at session lows, down 16.94 points, or 0.9%, at 1,867.72.
Twenty seven out of thirty Dow components ended in the red. Financial and consumer-discretionary sectors led the decline.
In deal news, Merck agreed to sell its consumer-products business, including the allergy-treatment Claritin and nasal decongestant Afrin, to German drug maker Bayer AG for $14.2 billion. Shares fell 2.5%.
Among stocks under focus, Facebook, LinkedIn, and Yelp displayed losses between 3.0% and 14%. Twitter sank 17.8% on heaviest volume on record. Office Depot shares surged 16% to $4.88, after the electronics retailer raised its outlook for 2014 operating profit and said it plans to close at least 400 U.S. stores by the end of 2016. American International Group shares dropped 4.1% after the insurer reported a substantial fall in first-quarter profit late Monday.
The sole U.S. economic report covered the trade deficit. The U.S. trade deficit narrowed to $40.40 billion in March from a downwardly revised $41.90 billion (from $42.3 billion) in February, while the consensus expected the trade balance to decline to -$40.6 billion. The BEA assumed that the trade balance would increase to roughly $42.5 billion in the advance estimate to first quarter GDP. The lower-than-expected trade deficit should boost first quarter GDP growth in the second estimate. The goods deficit fell by $0.6 billion to $60.8 billion in March from $61.3 billion in February. The services surplus increased by $0.9 billion to $20.4 billion in March from $19.5 billion in February.
It was a mixed finish for bullion metals on Tuesday, 06 May 2014. Gold prices ended the U.S. day session modestly lower after a two-session climb, but stayed near a three-week high as flare-ups in Ukraine and uncertainty in the U.S. equities market combined to provide support to the precious metal. Silver gained.
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Gold for June delivery fell 70 cents, or 0.1%, to settle at $1,308.60 an ounce on the Comex division of the New York Mercantile Exchange. July silver tacked on 7 cents, or 0.4%, to $19.645 an ounce.
Crude Oil futures ended nearly flat on Tuesday, 06 May 2014 and below $100 a barrel on as uncertainty over the global economic outlook and price pressure from hefty U.S. crude inventories mostly offset support from the turmoil in Ukraine. Crude oil for June delivery tacked on 2 cents to settle at $99.50 a barrel after earlier hitting highs above the $100 mark.
Market expects the EIA to report another increase in crude supplies when releases its weekly petroleum-supply data on Wednesday morning. Market forecasts a climb of 1.3 million barrels in crude stockpiles for the week ended 2 May 2014. They expect gasoline inventories to fall by 900,000 barrels and forecast a climb of 1.5 million barrels for distillates, which include heating oil.
Indian ADRs ended mixed on Tuesday. Among the IT sector, Infosys rose 0.13% at $53.29 and Wipro was down 1.18% at $11.77. In the banking space, ICICI Bank was down 0.61% at $43.99 and HDFC Bank added 0.12% at $40.88. In the other sectors, Tata Motors gained 1.15% at $37.75 and Dr Reddy's Laboratories shed 0.48% at $45.66.
Despite the daylong selling, participation was a bit below average as less than 690 million shares changed hands at the NYSE.
Tomorrow, the weekly MBA Mortgage Index will be released at 7:00 ET, while Q1 Productivity and Unit Labor Costs will be announced at 8:30 ET. The day's data will be topped off with a 15:00 ET release of the March Consumer Credit report. Also of note, Fed Chair Janet Yellen will appear before the Joint Economic Committee at 10:00 ET.
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