World Market Update 04/05/2011

U.S. Markets

U.S. stocks ended mixed on Monday as gains from materials and health care sector shares were offset by declines from technology and financials.

The Dow Jones industrial average gained 23.31 points, or 0.19 percent, to 12,400.03. The Standard & Poor's 500 advanced 0.46 points, or 0.03 percent, to 1,332.87. The Nasdaq Composite declined 0.41 points, or 0.01 percent, to 2,789.19.

With no major economic data on Monday, investor attention was focused on the several Federal Reserve officials scheduled to speak this week. The minutes of the latest FOMC meeting will be released on Tuesday.

Investors are looking to see what the Federal Reserve will do with its program of quantitative easing and when it will start to raise interest rates. A more accommodative stance from the Federal Reserve is positive for the stock market and vice versa.

Technology sector shares declined after Gartner Inc. analysts made cautious comments on semiconductor supply-chain problems in the wake of Japan's earthquake.

In the latest M&A activity, Pfizer Inc. (NYSE: PFE) said it agreed to sell its Capsugel business, a maker of hard capsules, to private equity firm Kohlberg Kravis Robert & Co. for $2.375 billion in cash.

On the corporate front, Southwest Airlines Co. (NYSE: LUV) shares dropped 1.66 percent after it canceled more than 50 plans planes on continuation of inspection for fuselage cracks in its fleet of Boeing 737-300 jetliners. A U.S. safety investigator said on Sunday evidence of widespread fuselage cracks was found on a jet that made an emergency landing with a hole in the cabin.

U.S. Futures

Futures on the S&P 500 are down 0.32 percent, futures on the Dow Jones Industrial Average are down 0.20 percent and Nasdaq100 futures are down 0.77 percent.

The euro declined 0.36 percent to 1.4169 against the dollar and the yen fell 0.34 percent. Crude oil futures declined 0.44 percent to $107.99 a barrel and gold futures rose 0.20 percent.

European Markets

European stock markets fell in early trade on Tuesday, led by declines from financials after Moody's Investor Service downgraded Portugal's sovereign debt by one notch to Baa1 from A3, citing fears the country would have difficulty meeting its deficit-reduction goals.

The Stoxx Europe 600 Index advanced 0.04 percent to 280.38. DAX30 declined 18.95 points or 0.26 percent to 7,156.38 and FTSE 100 declined 13.25 points or 0.22 percent to 6,003.73, while CAC 40 declined 23.83 points or 0.59 percent 4,019.09.

Among financials, Banco Santander declined 0.53 percent to 63.0 euros and Deutsche Bank declined 1.06 percent to 41.71 euros, while Societe Generale fell 2.17 percent to 44.81 euros.

Close Brothers Group Plc. declined 2.47 percent after the company stock was cut to “hold” from “add” at Numis Securities Ltd.

Vestas Wind Systems declined 1.93 percent to 9.9 euros after the company stock was downgraded to “hold” rating from “buy” rating at Nordea Bank AB.

Asian Markets

Asian stocks ended mixed on Tuesday as Tokyo shares hurt amid ongoing nuclear crisis Fukushima Daiichi atomic plant.

Japanese stocks ended lower, led by declines from Tokyo Electric Power and automaker companies shares. Benchmark Nikkei declined 0.15 percent or 14.46 points to 9,435.01.

Fukushima reactors have begun dumping a total of 11,500 tons of water into the Pacific Ocean, starting Monday evening Japan time as the water in the Number 2 reactor (unit 2) is so highly contaminated that it had to be taken out and put in the storage site where the less radioactive water is.

Shares of Tokyo Electric Power, Japan's biggest utility and operator of the Fukushima nuclear-power plant, plunged 17.91 percent to 362 yen, the lowest level in 60 years.

Among the automakers, Honda Motor declined 2.52 percent to 2,934 yen and Nissan Motors declined 2.18 percent to 715 yen, while Toyota Motor declined 2.39 percent to 3,260 yen after the company said it will temporarily shut down all of its North American factories due to parts shortages.

Among the exporters, Canon Inc. declined 1.37 percent to 3,600 yen and Sony Corp. declined 0.68 percent to 2,622 yen, while Fujitsu Ltd. declined 2.1 percent.

South Korean shares rose to a record closing high on Tuesday, led by gains from technology and refining stocks. Seoul composite advanced 14.56 points or 0.69 percent to 2,130.43, the highest level ever. LG Chem Ltd. surged 4.92 percent and Honam Petrochemical Corp. gained 3.34 percent, while LG Display advanced 3.37 percent.

Markets in China and Hong Kong are closed for a public holiday.