U.S. stocks: day of joy and a week of losses for the Dow Jones Industrial

Dow Jones Industrial Average completed a problematic week

In brief: Dow Jones Industrial Average finished the last day of the week growth, but the overall level of losses for the Dow index was very high.

Dow Jones Industrial Average won the fight but lost a week-long battle. Trading in the U.S. on Friday, June 25 ended primarily due to growth of stock indices shares of financial companies. Investors are pleased with the fact that concerted Senate and House of Representatives of the Draft Law on the regulation of the financial sector was not as tough as expected. But the following week, the indices fell.

As a result of trading the index of “blue chips” Dow Jones Industrial Average fell by 4.99 points or 0.05%, to 10145 points. The index of wide market S & P 500 closed down 2.91 points to growth, or 0,27%, at around 1077 points. “High-tech” Nasdaq Composite closed higher at 6.06 points or 0.27% at around 2223 points. Last week the index Dow Jones Industrial Average fell by 2,9%, the index of wide market S & P 500 fell 3.7%, and high tech Nasdaq Composite lost 3.7%. U.S. lawmakers completed work on the historic document, revising the system of financial regulation, when the Capitol over the hill already dawn, following the instructions of President Barack Obama to complete the preparation of the plan by Friday – the day when Canada will meet the leaders of the G20. In addition, the Basel Committee, dealing with banking regulation, take back some of its proposals, concerning, in particular, the allocation of the banks billions of dollars of additional capital for emergencies, said on Friday Financial Times. The project is the latest proposals of the Basel Committee will be presented at the G20 summit in Toronto this weekend. The most significant changes contained in the recommendations on the amount of liquidity that banks need to reserve. The Committee may refuse the proposal that banks should be forced to maintain the standard “stable net funding. Instead, the element of the plan may be applied a new system of oversight.

Investors’ attention was drawn to the summit of Big Twenty. Meeting the leaders of the 20 largest developed economies of the world will be held June 26 and 27 in Toronto. It will raise issues of how to achieve balanced growth in the global economy and tighten financial controls. According to reviewers, the main topic of the summit will consolidate budgets, the idea that there was under growing pressure from foreign investors in the member governments of the European Union, fearful of bloated budget deficits in the midst of Greek crisis. In this situation, the European Commission had to think about tightening financial controls in the block. Became obvious imbalance in the world, which in the long term poses a threat to global housekeeper, and reiterates that countries with strong fundamentals, such as Korea or Brazil, may eventually suffer because of doubts about the creditworthiness of investors in Europe as well as stocks and currencies become cheaper and the cost of borrowing increases.

Since the summit in Busan, some countries managed to submit to strict program to reduce budgetary expenditures. France has set a goal to save 100 billion euros in the coming three to four years, while Germany – 80 billion euros. On Tuesday, the British government provided emergency budget that includes a sharp reduction in public spending and a significant increase in taxes. These measures are needed to address the structural budget deficit for 2014-2015 GG. Leaders from Europe to be an easy task to convince the U.S. government during the summit that the austerity program is not cut down on the top of the already weak growth. U.S. officials have repeatedly said that the U.S. is not going to be the only driver of world economic growth, but the president Barack Obama urged the leaders of large Twenties to join efforts in Toronto and to devise measures which would be supported and strengthened it. Governments in Europe are also pinning their hopes on China’s recent decision on the gradual strengthening of the yuan, which ultimately will change the orientation of the Chinese economy from exports to domestic consumption, and alleviate the pressure of U.S. demand in Europe.

Economic data from the U.S. proved to be controversial. At 17:55 Moscow time it was published a final index of consumer confidence in the University of Michigan for June, which was better forecasts. The index was 76 points instead of the projected 75.5 points. Meanwhile, the estimate of the growth of economic activities in the I quarter of 2010 in the United States has been lowered due to lower consumer spending. U.S. Department of Commerce reported that the final assessment of the U.S. gross domestic product in I quarter has increased by 2,7%. In the April evaluation reported on the growth rate at 3,2%. Economists polled by Dow Jones Newswires, predicted that the estimate of GDP growth will be maintained at 3,0%.

GDP of France for the I quarter of this year, according to final data, as compared with the previous quarter has increased by 0,1%. This was reported today the country’s National Statistics Office Insee. Analysts forecast growth of this indicator was up 0.1%.

Published data suggest that the recovery of the U.S. economy are moderate pace. Evaluation of the growth in consumer spending was reduced to 3,0% from 3,5%. But the evaluation of the growth of corporate profits in the quarter I was raised to 12,1% from 9,7%. In the IV quarter of 2009 this had risen to 8,2%. According to analysts, moderate economic growth will continue in the II quarter, but it is possible that the recovery will be fragile, as evidenced by weak economic data in May. For example, retail sales declined and the pace of job growth has been low. According to today’s report, inventories of U.S. companies increased by $ 41.2 billion in the previous assessment figured figure of $ 33.9 billion, estimates the growth of exports and imports were revised upward to 11.3%, and 14.8% respectively.

Evaluation of the growth of price index for personal consumption expenditures, PCE, was raised to 1,6% from 1,5% of. Evaluation of the growth of basic price index for personal consumption was increased to 0,7% from 0,6%. The U.S. aircraft manufacturer Boeing announced that it has decided to conduct a thorough analysis of all five test aircraft Boeing-787 before they can once again get off the ground because of problems in the caudal part of the mechanism, supplied by the Italian manufacturer Alenia. Engineers from Boeing, the aircraft experiencing 787 Dreamliner, find manufacturing defects that can cause damage to the horizontal stabilizer in place of their attachment to the fuselage. Boeing shares went up by 1,5%. Oil company BP said that so far has spent $ 2.35 billion on efforts to combat oil spills in the Gulf Coast. The British company said that this amount includes $ 126 million paid in the form of compensation in response to claims by victims of the disaster. “Drilling of additional wells, designed to stop the uncontrolled release of oil into the waters of the Gulf, and measures for the collection of oil and go according to plan”, – stated in the BP. BP shares have fallen in price on 5,9%. BlackBerry device maker Canadian company Research In Motion has published a report about a 20 percent jump in net profit for the last quarter, but the company’s revenues and the rate of subscriber growth disappointed investors. The company’s shares fell by 10,6%.

Goldman Sachs regained first place in terms of advice on M & A market in the first half of 2010, underlining its stability despite the accusations of fraud by U.S. authorities. While the number of deals in the market is still small, Goldman’s advisory role in operations in the amount of $ 190 billion U.S. bank allowed to regain “the crown”, taking her from Morgan Stanley, which last year surpassed his chief rival for the first time since 1996 . Goldman shares went up by 3,7%. Euro dropped in price to $ 1.23 vs. $ 1,232 of Thursday. The dollar rose against the yen to 89.46 against 89.39. The British pound rose to $ 1,495 versus $ 1,492. Dollar Index, allowing to estimate the value of U.S. dollar against a basket of six major currencies, fell to 85.71 against 85.76.

The price of oil on Friday, June 25 grew out of the storm in the Gulf of Mexico, which could lead to a breach of extraction and supply of black gold. The August futures for delivery of petroleum of mark WTI rose $ 2.35 to $ 78.86 per barrel. Futures on the supply of gasoline went up by $ 0.07 to $ 2.15 per gallon. Gold price on Friday, June 25 bit is not reached up to a new record. Investors bought up gold, caution on the eve of the summit Big Twenty. As a result of the regular trading session on the New York Mercantile Exchange, NYMEX, the August futures for gold delivery have increased by 0,8% to $ 1,256.20 per troy ounce.

Ukrainian Globalist
2010-06-25 22:28, Economics.

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