Monday, November 29, 1999

GLOBAL MARKETS - U.S. stocks down on earnings outlook

News posted by www.newsinfoline.com

U.S. stocks dropped on Monday following disappointing earnings outlooks, and the euro slipped as fears persisted that a euro-zone debt crisis would worsen, crimping growth in the region.In early New York trade, the euro was down 0.1 percent at $1.2339 from a previous session close of $1.2360. But it reached $1.2234 earlier in the session.On Sunday, German Chancellor Angela Merkel said that a $1 trillion European Union-International Monetary Fund bailout plan had only bought the euro zone time to tackle its fundamental problem: a yawning gap between its strongest and weakest economies.The Dow Jones industrial average was down 51.54 points, or 0.49 percent, at 10,568.62. The Standard & Poor's 500 Index fell 5.46 points, or 0.48 percent, at 1,130.22. The Nasdaq Composite Index dipped 5 points, or 0.21 percent, at 2,341.85.World financial markets saw limited gains on persistent concerns that the euro-zone's sovereign debt issues and planned austerity measures would hurt growth.Adding to the sour sentiment, Lowe's Cos the No. 2 U.S. home improvement chain, gave a disappointing profit forecast for the rest of the year. Lowe's, down about 4 percent, sounded a note of caution about the pace of a U.S. economic recovery.Economic data on Monday from the New York Federal Reserve showed manufacturing in New York State continued to grow in May, but at a slower pace. The gauge also came in far below economists' forecasts."It is probably a good excuse for a sell-off," said Mike Lenhoff, chief strategist at wealth manager Brewin Dolphin. "We have a recovery but it is a feeble one. If you load onto that recovery a severe dose of fiscal austerity, the prospects then for a sustainable recovery (are strained)."MAJOR EQUITY MARKETS SEESAWOther major equity markets traded between gains and losses, with more of the latter.The FTSEurofirst 300 index of top European shares fell 1.1 points, or 0.11 percent, while world stocks as measured by the MSCI All-Country index were down 1.23 percent. The more volatile emerging markets index was down 2.26 percent.In Japan the Nikkei fell more than 225 points, or 2.17 percent, to a 10-week closing low, mirroring falls in the rest of the region as investors ignored encouraging economic data from the United States, Japan and Singapore.Weakness in the euro and the pound helped the dollar index, which was up 0.59 percent at 86.575 from a previous session close of 86.095.U.S. Treasury debt prices were higher.After rising nearly a point in the previous session, the benchmark 10-year note rose 3/32 on Monday, its yield easing to 3.44 percent. Two-year notes were unchanged in price, yielding 0.78 percent.In energy and commodities prices, U.S. light sweet crude oil fell $1.60, or 2.21 percent, to $70.01 per barrel, while spot gold prices rose 71 cents, or 0.06 percent, to $1233.20. The Reuters/Jefferies CRB Index was down 3.76 points, or 1.45 percent, at 254.79.(Additional reporting by Blaise Robinson, Jeremy Gaunt and Neal Armstrong in London; Editing by Padraic Cassidy)
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