The U.S. trading session began with the volatile movements of the indexes in both directions, but shortly after investors reacted instantaneously with sales of shares on news of strong second earthquake in Japan. The price-weighted Dow Jones IA index fell the most with 0.5 percent to 12,369 points in the first 90 minutes of trade. The broader index S & P 500 lost 0.3 percent to 1332 points, and Nasdaq stock index leading Nasdaq Composite gave up 0.2 percent to 2795 points. An earthquake measuring 7.4 on the Richter scale has shaken today Miyagi Prefecture, and then alert the authorities have declared the tsunami in coastal regions, writes Wall Street Journal. Shortly before the decision of the European Central Bank to increase interest rates reminded investors of growing inflation risks, which raised the price of gold to a record 1,463 dollars an ounce. The U.S. economic data out today showed that the number of Americans who have applied for the first time applications for unemployment benefits last week fell slightly by 10 thousand to 382 thousand. The data are slightly better than market expectations. Shortly before the end of the session and go to Federal Reserve data on consumer credit in the U.S. in February.
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The European indexes rose Thursday in anticipation of the extraordinary meeting of central bank governors and finance ministers of the G-7 in conjunction with the nuclear crisis in Japan. Stoxx Europe 600 is increased to 1.76 percent to 267 points after Wednesday closed at its lowest level for the year because of concerns about the situation in Japan and lowering the credit rating of Portugal. On Wednesday, indexes in Frankfurt, Paris and London also fell to their lowest levels for 2011. The shares of Siemens AG rose above 4% after UniCredit raised the rating of the company. The European markets were also supported by a strong start on Wall Street after the announcement of the better weekly data on unemployment in the U.S. and growth of consumer prices for February. The attention of investors in the U.S. and Europe remained transfixed on the development of nuclear crisis in Japan. The financial leaders of the G-7 will talk later today to discuss the situation around the nuclear power plant in the breakdown Fukoshima.
“The European indexes doing drunk to recover losses from the last 6 days, supported by the G-7, which will discuss measures to calm the market,” said Stephen Pope, director of Spotlight Ideas.
“I do not accept that what last Thursday were good companies with sound prospects suddenly do not cost a penny,” he said.
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The unemployment rate in the U.S. is expected to remain well above 7 percent by the end of 2012 and throughout the term of the current U.S. president Barack Obama. It said Federal Reserve Chairman Ben Bernanke before Congress, said New York Times. He will need time to recover all the 8.5 million jobs, removed during the recession in the U.S. in 2008 and 2009. Ben Bernanke is concerned that the economic outlook and financial conditions in the country remain unusually uncertain, and warns that the fiscal crisis in Europe has become an obstacle to economic growth in recent months. Speaking on the occasion of his presentation was a semi-annual monetary policy report to the Federal Reserve to Congress. Analysts say his tone is become much more cautious than the presentation of the last report in February. Bernanke confirmed in his speech that the economic expansion that began in mid 2009, continues but with lower rates. That contributes significant support from governments and central banks with their common fiscal and monetary policy. He expects that the growing demand of households and businesses will help sustain growth, despite incentives from the government will have less effect.
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With significant losses U.S. indexes ended the exchange session on Tuesday. Decrease was caused by a data consumer confidence in the country, which showed a greater decline in June compared to expectations of market experts. “Even a technical recession to end last summer, consumers remain concerned about their jobs and future income, refrain from purchases that would contribute to sustainable GDP growth,” Dan told MarketWatch Griyhaus, chief analyst at the investment company Miller Tabak. His words are confirmed by statistics on U.S. consumer confidence this month, which fell after three consecutive increases. According to the confidence index of business organization Conference Board decline quite sharply – up 52.9 points to 62.7 points in May. Expectations of most economists was for a value of 62 points in June. The organization indicated that the main reason for the decline is precisely the uncertainty about the future of the labor market. While no permanent recovery observed in this market can hardly be expected improvement in consumer confidence and consumption, respectively, analysts say. Exchange session ended in New York for Dow Jones Industrial Average with the collapse of 2.64 per cent to 9871 points, S & P 500 fell 3.1 percent to its lowest level this year – 1041 points, and Nasdaq Composite marked loss nearly 3.9 percent to 2135 points.
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