1:00PM NY, 5:00 PM Frankfurt European markets gained ground, boosted by financial stocks.
European stock markets gained ground on Tuesday, boosted by strength in the financial sector, as well as gains in the shares of airlines Air France-KLM and easyJet. Investors expected signals from the Federal Reserve that credit market losses are slowing U.S. economic growth and as a result borrowing costs will fall. Regional indexes climbed, led by the U.K. with an advance of 1.9%, France rising 1.6% and Germany, up 0.9%.
A broker upgraded the European banking sector to overweight from neutral, saying that it now sees considerable potential upside for sector share prices after the recent market correction. Spanish banks Santander and BBVA rose 2.7% and 2%, respectively. Credit Suisse Group jumped 5.2% in Switzerland.
In Frankfurt the financial service sector advanced, with property finance firm Hypo Real Estate rising 4.4%. Commerzbank shares jumped 5.2% after a broker upgrade of the sector. Banks also performed well, with Deutsche Bank rising 3.9%.
In Paris BNP Paribas was a notable gainer among bank shares, posting an advance of 3.8%. Societe Generale followed suit, jumping 3.2%. Dexia, owner of bond insurer Financial Security Assurance, gained 3.3%. Air France-KLM Group added 3.4% after Europe''s biggest air carrier said passenger traffic rose in July on increased travel to the Americas and Asia.
In London financial stocks led gainers, with Royal Bank of Scotland moving up 3.5% and HSBC rising 1.5%. Barclays climbed 2.6% and hedge fund manager Man Group rose 3.2%. Standard Chartered climbed 4.3% after the bank said first- half profit rose 26%, beating analyst estimates. Elsewhere, Tesco climbed 2.6% after Deutsche Bank upgraded its stock.
11:30AM Market averages traded lower. Banks and insurers traded mixed. Luminent plunged 80%.
U.S. market averages continued to trade lower, reflecting reports of increased Q2 labor costs and lower-than-forecast productivity, as well as cautiousness ahead of the Fed Reserve''s interest-rate decision.
Shares of major U.S. banks and brokerage firms traded mixed. Insurer Assurant (
AIZ: chart) advanced 3.5% after Merrill Lynch upgraded its stock to buy. At the same time, Luminent Mortgage Capital (
LUM: chart) plunged 80% after it was cut to sell from neutral by UBS. The lender suspended its quarterly dividend and said it would explore options including a sale. Hedge fund Blackstone (
BX: chart) gained 1.8% after Lehman Bros. gave it an overweight rating.
On the earnings news front, Tyco International (
TYC: chart) fell 2.5% after posting Q3 loss due to charges primarily related to a legal settlement. However, adjusted results exceeded analyst expectations. Cisco Systems (
CSCO: chart) is scheduled to release earnings after the closing bell. Shares edged down 0.7%.
In late morning trading, the Dow Jones industrial average was down 47.80, or 0.35%, at 13,420.98 after soaring 286 points Monday. The Standard & Poor''s 500 index fell 2.66, or 0.18%, to 1,465.01, and the Nasdaq composite index fell 7.90, or 0.31%, to 2,539.43. The yield on the benchmark 10-year Treasury note was unchanged at 4.74%.
10:30AM New York, 8:00PM Mumbai – Banks, real estate, and cement stocks led a mild rise in Sensex in India.
Sensex in Mumbai trading closed up 29.74 or 0.2% to 14,932.77. Weakness and volatility in New York trading has held most global markets hostage to vagaries of traders in New York. In the broader market in Mumbai trading, 1,660 stocks gained, 1,026 declined, and 62 remained unchanged.
Of the 30 stocks in Sensex, 17 increased and 13 declined. ITC with a loss of 3% led the decliners in the index. Bajaj Auto lost 2% to 2,262 and Bhel declined 0.8% to 1,670.
Companies in power generation, cement, banks, and mobile telephony led a mild advance.
Ambuja Cements gained 0.8% to close at 127 rupees, ACC increased 0.35% to 982 rupees, and Grasim increased 0.45% to 2,910 rupees. Rising construction in Mumbai and surrounding areas in Maharashtra has prompted cement prices to jump 20% above 280 rupees.
Bharti Airtel jumped 1.9% to 877.20 rupees but Reliance Communication decreased 0.2% to 530 rupees.
Banks led the most gainers in the index. Canara Bank led the banking stocks with a gain of 4% and Kotak Mahindra, Bank of India, and Union Bank of India jumped 2%. ICICI Bank dropped 2% to 870 rupees and State Bank of India lost a fraction to close at 1,726 rupees.
Punk Llyod surged 3.6% to 287 rupees on an order to build a unit for Bharat Oman Refineries. The project with a 2-year completion date, has lifted total order backlog to 16,480 crore rupees.
