Stocks were lower in Europe and on Wall Street on Friday as the Group of 20 nations ended a summit meeting with little apparent headway in resolving Europe’s debt crisis.
A jobs report that showed modest gains but still sluggish growth in the United States did little to improve sentiment.
Equities markets in the United States were on track to record a cumulative loss of at least 2 percent for the week, after gaining more than 3 percent last week, as the markets continue to gyrate along with events in Europe.
Prime Minister George A. Papandreou of Greece faced a confidence vote on Friday after calling off a referendum on Greece’s new rescue deal with its international creditors. Meanwhile, a meeting in France of G-20 leaders wrapped up without bringing in commitments of funds to prop up Europe’s bailout fund.
While the debt crisis in Europe has unsettled global financial markets for more than a year, analysts were also watching on Friday for any insight that the monthly jobs report in the United States would provide on the pace of the nation’s recovery.
But it revealed only a modest improvement. The Department of Labor reported that employers in the United States added 80,000 jobs in October, slightly below economists’ forecasts, compared with 158,000 jobs in September.
The Euro Stoxx 50 index, a barometer of euro zone blue chips, closed down 2.4 percent. The German DAX was down 2.7 percent and the CAC 40 in Paris was down 2.2 percent. The FTSE 100 index in London ended the day 0.3 percent lower.
In afternoon trading on Wall Street, the Standard & Poor’s 500-stock index was down about 1 percent, as was the Dow Jones industrial average. The Nasdaq composite index was down 0.7 percent.
The United States benchmark 10-year bond yield was 2.052 percent, compared with 2.074 percent on Thursday.
Financial stocks were down 1.5 percent in the United States, the worst performing sector on the broader market.
Following the bankruptcy filing this week of MF Global in the United States, “investors are watching their backs for other troubled financials,” said Guy LeBas, the chief fixed income strategist for Janney Montgomery Scott.
Also this week, borrowing costs in Europe for the most troubled economies have been pushing up again to worrying levels.
Italian bonds, among the most pressured, have hit yield levels that mark the most expensive 10-year money the country has borrowed since joining the euro, making it even more difficult to reduce the overall debt load.
On Friday, the yield on 10-year bonds in Italy climbed again to 6.35 percent, up from 6.181 percent.
Mr. LeBas said that it could be a combination of factors causing bond prices to decline, including the “dragging on” of the uncertainty in Greece and the inability of the G-20 leaders to muster funds for the European bailout. One step that emerged from the G-20 meeting, however, was Italy’s decision to have the International Monetary Fund monitor its belt-tightening efforts.
“Looking ahead, while Greece is front and center now, the core problem for the euro zone is how to mitigate contagion to Italy,” said currency strategists from Brown Brothers Harriman in a research note. The euro was $1.3759 on Friday, down from $1.3823 on Thursday.
In addition to Europe and the economic data in the United States, investors have also been scrutinizing corporate reports, which in recent weeks have somewhat steadied the American market amid the turmoil that filtered through from the euro zone.
On Friday, all of the major sectors in the broader market were lower, but some companies appeared to curb any steeper declines.
Starbucks, for example, was up more than 7 percent after delivering fiscal fourth quarter earnings that beat estimates, and was the most widely traded stock of the consumer companies, propping them up as a group which fell less than 1 percent.
Genworth Financial, for its part, was one of the most widely traded stocks, and one of the few to rise, in the financial sector. Its share hurtled past 16 percent after reporting better-than-expected third-quarter earnings per share.
Groupon Inc. shares were up more than 40 percent at $28.80 at one point during Friday’s session, its trading debut.
nytimes.com
A jobs report that showed modest gains but still sluggish growth in the United States did little to improve sentiment.
Equities markets in the United States were on track to record a cumulative loss of at least 2 percent for the week, after gaining more than 3 percent last week, as the markets continue to gyrate along with events in Europe.
Prime Minister George A. Papandreou of Greece faced a confidence vote on Friday after calling off a referendum on Greece’s new rescue deal with its international creditors. Meanwhile, a meeting in France of G-20 leaders wrapped up without bringing in commitments of funds to prop up Europe’s bailout fund.
While the debt crisis in Europe has unsettled global financial markets for more than a year, analysts were also watching on Friday for any insight that the monthly jobs report in the United States would provide on the pace of the nation’s recovery.
But it revealed only a modest improvement. The Department of Labor reported that employers in the United States added 80,000 jobs in October, slightly below economists’ forecasts, compared with 158,000 jobs in September.
The Euro Stoxx 50 index, a barometer of euro zone blue chips, closed down 2.4 percent. The German DAX was down 2.7 percent and the CAC 40 in Paris was down 2.2 percent. The FTSE 100 index in London ended the day 0.3 percent lower.
In afternoon trading on Wall Street, the Standard & Poor’s 500-stock index was down about 1 percent, as was the Dow Jones industrial average. The Nasdaq composite index was down 0.7 percent.
The United States benchmark 10-year bond yield was 2.052 percent, compared with 2.074 percent on Thursday.
Financial stocks were down 1.5 percent in the United States, the worst performing sector on the broader market.
Following the bankruptcy filing this week of MF Global in the United States, “investors are watching their backs for other troubled financials,” said Guy LeBas, the chief fixed income strategist for Janney Montgomery Scott.
Also this week, borrowing costs in Europe for the most troubled economies have been pushing up again to worrying levels.
Italian bonds, among the most pressured, have hit yield levels that mark the most expensive 10-year money the country has borrowed since joining the euro, making it even more difficult to reduce the overall debt load.
On Friday, the yield on 10-year bonds in Italy climbed again to 6.35 percent, up from 6.181 percent.
Mr. LeBas said that it could be a combination of factors causing bond prices to decline, including the “dragging on” of the uncertainty in Greece and the inability of the G-20 leaders to muster funds for the European bailout. One step that emerged from the G-20 meeting, however, was Italy’s decision to have the International Monetary Fund monitor its belt-tightening efforts.
“Looking ahead, while Greece is front and center now, the core problem for the euro zone is how to mitigate contagion to Italy,” said currency strategists from Brown Brothers Harriman in a research note. The euro was $1.3759 on Friday, down from $1.3823 on Thursday.
In addition to Europe and the economic data in the United States, investors have also been scrutinizing corporate reports, which in recent weeks have somewhat steadied the American market amid the turmoil that filtered through from the euro zone.
On Friday, all of the major sectors in the broader market were lower, but some companies appeared to curb any steeper declines.
Starbucks, for example, was up more than 7 percent after delivering fiscal fourth quarter earnings that beat estimates, and was the most widely traded stock of the consumer companies, propping them up as a group which fell less than 1 percent.
Genworth Financial, for its part, was one of the most widely traded stocks, and one of the few to rise, in the financial sector. Its share hurtled past 16 percent after reporting better-than-expected third-quarter earnings per share.
Groupon Inc. shares were up more than 40 percent at $28.80 at one point during Friday’s session, its trading debut.
nytimes.com
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