US SUMMARY: Shares weak, oil rebounds

Index Change Percent change

*DJIA 11431.43 -224.64 -1.93

*Nasdaq 2355.73 -22.64 -0.95

*S&P 500 1266.07 -23.12 -1.79

Nymex crude

for September $120.10 +1.53 cents

10 year U.S.

Treasury -3.93 percent

*Thursday’s close

STOCKS: Wall Street tumbled Thursday as further troubles in the financial sector, higher unemployment and lackluster retail sales touched off fresh concerns about the economy erasing most of the 370-point gain the Dow logged the prior two sessions.

Heading the list of worries, insurer American International Group Inc. reported a loss of more than $5 billion for the second quarter and the Labor Department said the number of newly laid off people seeking jobless benefits last week jumped to its highest level in more than six years. Weak sales reports from Wal-Mart Stores Inc. and other retailers added to investors’ unease.

Meanwhile, an announcement by the credit-ratings agency Moody’s Investors Service that it placed the long-term ratings of credit card lender American Express Co. on review for possible downgrade exacerbated investors’ nervousness.

BONDS: Treasury bond prices rebounded Thursday as investors sought safe-haven investments after a surprise jump in weekly unemployment claims and disappointing sales reports from retailers.

OIL: Oil prices jumped back above $120 a barrel Thursday, halting a steep three-day slide after Kurdish rebels claimed responsibility for a fire at key Turkish pipeline that supplies Western countries.

Crude sank more than $6 over the previous three days, bringing prices $30 lower than its July high above $147 a barrel.

FOREX: The dollar was higher against most major currencies Thursday after the Bank of England and the European Central Bank decided to leave key interest rates unchanged.

The 15-nation euro slipped to $1.5328 in late New York trading, below the $1.5420 it bought late Wednesday. The pound was weaker at $1.9436, compared with $1.9475 the previous day.

METALS: Gold prices fell to an almost two-month low after the dollar strengthened against the euro, diminishing the metal’s appeal as an inflation hedge.

Gold for December delivery fell $5.10 to settle at $877.90 an ounce on the Nymex, after earlier falling to $874.80, the lowest level since June 16.

Other precious metals also fell. Silver for September delivery lost 24.8 cents to settle at $16.257 an ounce on the Nymex, while September copper fell about half a penny to settle at $3.418 a pound.

ASIA SUMMARY: Shares mixed, oil steady

Index Change Percent change

Nikkei 225 13135.76 +10.77 +0.08 (0347 GMT)

S&P/ASX 200 4981.00 -2.30 -0.05 (0406 GMT)

Straits Times 2823.19 -11.52 -0.41 (0352 GMT)

Hang Seng 22109.02 +4.82 +0.02 (0352 GMT)

Seoul Composite 1570.64 +6.64 +0.42 (0422 GMT)

BSE Sensex 15036.57 -80.68 -0.53 (0430 GMT)

usd-yen 109.61 (Intra-day)

10-year JGBs -1.490 percent (Intra-day)

Brent North Sea $117.92 +6 cents

crude for September

STOCKS: Asian were mixed Friday. Hong Kong shares turned higher, reversing opening losses, as utilities and local properties attracted buying interest amid a raft of fresh negative news in the US financial sector and the general economy.

However, Australia and Singapore shares were lower following another sell-off on weak Wall Street.

BONDS: Japanese government bond futures jumped to a four-month high on Friday after a sharp rally in U.S. Treasuries and on concerns about the outlook for the domestic and overseas economies.

Japanese government bond rallied broadly with yields on two-year, 10-year, 20-year and 30-year JGBs dropping to four-month lows, while the lead three-month euroyen futures marched to a four-month high.

OIL: Oil held broadly steady at near $120 a barrel on Friday, rebounding from three-month lows due to an attack on a one million barrel per day pipeline in Turkey, but bearish demand sentiment prevailed.

FOREX: The dollar surged across the board on Friday, hitting a five-month high against the euro and a 17-month peak against the pound as the European Central Bank’s caution on the growth outlook reinforced worries of a faltering global economy.

The dollar index vaulted to its highest in more than five months, with investors and analysts saying the U.S. currency is staging a broad rebound from record lows struck earlier in the year as the global slowdown takes a toll on other major currencies.

EUROPE SUMMARY: Shares mixed, oil higher

Index Change Percent change

*FTSE 5477.50 -8.60 -0.16

*DAX 6543.49 -17.90 -0.27

*CAC 4457.43 +9.10 +0.20

pound-dollar $1.9520 (1208 GMT)

euro-dollar $1.5374 (1452 GMT)

Brent crude

(September) $118.03 +$1.03 (Intra-day)

*Thursday’s close

STOCKS: UK blue chips closed weaker, marginally off their session lows, as Wall Street remained down, strength in the mining sector offsetting a fall in the insurers and real estate investment trusts sector.

In the UK, miners continued in Wednesday’s vein as sector consolidation hopes encouraged investors and gains were underpinned by firmer metals prices.

BONDS: European government bonds jumped higher following European Central Bank president Jean-Claude Trichet’s press briefing, which, while maintaining a hawkish tone, did not build on concerns over inflation since the last meeting.

Following the ECB’s decision to keep interest rates on hold at 4.25 percent in the euro zone, Trichet reiterated that risks to the economy from weaker growth and concerns that rising inflation could feed through into second-round effects and higher wages deals.

FOREX: The euro fell under $1.54 for the first time since mid June as focus fell squarely on the dire outlook for the euro zone economy, especially in the face of the European Central Bank’s reluctance to lower borrowing costs.

The pound was slightly stronger following the the Bank of England’s decision to leave interest rates on hold at 5 percent.

OIL: World oil prices rebounded on Thursday, as it was announced that a key pipeline carrying crude from Asia to the West would remain shut for about 15 days following a recent explosion.

It was announced on Thursday that the Baku-Tbilisi-Ceyhan oil pipeline would remain shut for about 15 days after a blast had occurred in a pump at a section in eastern Turkey.

The fire that had started on Tuesday was likely to continue burning for another two days until the oil remaining in the pipe ran out, an official from Turkey’s state-run oil and gas company BOTAS told Anatolia news agency.

Local authorities ruled out the possibility of sabotage, saying a fault in the system had been detected before the blast.

Source: http://www.afxnews.com

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