World Market Update 29/03/2011

U.S. Markets

U.S. stocks gave up modest gains and ended slightly lower as declines from consumer and technology companies’ shares weighed in the final hour of trading session.

The Dow Jones Industrial Average closed down 22.71 points, or 0.19 percent, to end at 12,197.88. The S&P 500 index declined 3.61 points, or 0.27 percent, to close at 1,310.19. The Nasdaq Composite declined 0.45 percent.

Economic data was positive on Monday as personal spending in the US rose more than expected in February and income increased less than expected, indicating that the average consumer is growing more confident about the economic recovery of the nation.

Personal spending rose $69.1 billion, or 0.7 percent in February month-on-month and income increased by $38.1 billion or 0.3 percent, while markets had expected the income and spending to rise 0.4 percent and 0.5 percent respectively. However, core personal consumption expenditures (PCE) price index, which excludes food and energy prices, increased 0.2 percent in line with the economists' expectations.

Meanwhile, pending homes sales in the US rebounded sharply in February, after showing a decline in the previous two months. The pending home sales index rose 2.1 percent to 90.8 from 88.9 in January, while markets had expected the index to increase slightly by 0.3 percent in the month.

On the corporate front, shares of Marriott International Inc. (NYSE:MAR) plunged 6.27 percent to $35.30 after the company said it expects revenue per available room or RevPAR at the low end of its guidance range due to modestly lower than expected RevPAR growth in North America. Separately the company stock was downgraded to “neutral” rating from “buy” rating at Goldman Sachs.

Nvidia Corp. (NASDAQ:NVDA) shares gained 3.7 percent to $19.32 after the company stock was upgraded to “market outperform” rating from “market perform” rating at JMP Securities.

U.S. Futures

Futures on the S&P 500 are up 0.18 percent, futures on the Dow Jones Industrial Average are up 0.16 percent and Nasdaq100 futures are up 0.26 percent.

The euro advanced 0.18 percent to 1.4113 against the dollar and the yen declined 0.28 percent. Crude oil futures declined 0.64 percent to $103.31 a barrel and gold futures declined 0.42 percent.

European Markets

European stock markets fell in early trade as banking sector stocks declined after UBI Banca SpA announced plans to offer new shares.

The Stoxx Europe 600 Index declined 0.4 percent to 275.13. DAX30 declined 41.33 points or 0.60 percent to 6,897.30 and FTSE 100 declined 14.59 points or 0.25 percent to 5,889.90, while CAC 40 declined 19.46 points or 0.49 percent 3,957.49.

UBI Banca Scpa declined 9.45 percent to 6.22 euros after the bank said it would increase share capital by as much as 1 billion euros, while Banca Popolare di Milano ScA declined 6.21 percent and ntesa Sanpaolo SpA fell 3.66 percent.

BP Plc. declined 2 percent after the company stock was downgraded to “sell” rating from “hold” rating at Collins Stewart.

Groupe Eurotunnel SA gained 2.92 percent to 7.39 euros after the company stock was upgraded to “overweight” rating from “equal weight” rating Morgan Stanley.

Asian Markets

Asian stock markets ended mixed on Tuesday as ongoing concerns over Japan’s nuclear crisis weighed on the sentiment.

Japanese stocks ended lower but well above the intraday lows as investors were worried about a report that work crews at Fukushima's Daiichi nuclear complex have found new pools of radioactive water at the complex and plutonium in the soil surrounding the complex. Benchmark Nikkei declined 0.21 percent or 19.45 points to 9,459.08.

Tokyo Electric Power co. said plutonium was found in five locations at the nuclear plant, but only two of the samples appeared to be from the leaking reactors, according to the Associated Press. The remaining reactors came from previous nuclear tests that left the element in many places around the world, the company said.

Shares of Tokyo Electric Power, Japan's biggest utility and operator of the Fukushima nuclear-power plant, plunged 14.85 percent to 596 yen on the news that Japanese government was considering temporarily nationalizing Tepco to facilitate its reconstruction.

Among automakers, Honda Motor gained 1.32 percent to 3,065 yen and Nissan Motor advanced 0.57 percent to 704 yen, while Toyota Motor declined 1.21 percent to 3,255 yen.

Hong Kong’s Hang Seng index declined 7.83 points or 0.03 percent to 23,060.36 and Chinese Shanghai composite fell 0.86 percent or 25.58 points to 2,958.43. China Resources Land Ltd. declined 1.46 percent to HK$13.44 and Guangzhou R&F Properties declined 2.28 percent to HK$11.12.

South Korean shares ended higher, led by gains from automakers and refiners companies shares. Seoul composite advanced 15.74 points or 0.77 percent to 2,072.13. Among refiners, S-Oil gained 4.59 percent and GS Holdings advanced 4.63 percent.

Hyundai Motor gained 3.75 percent on a rosy earnings outlook. The company is expected to report first quarter operating profit of 803.1 billion won.