While you were sleeping: Wall Street sinks, yen up

While you were sleeping: Wall Street sinks, yen gains

Aug. 31 (BusinessDesk) – Stocks on Wall Street fell, with the Standard & Poor’s 500 Index heading for a decline of almost 5% this month, after government figures showed personal incomes rose less than expected.

The income figures overshadowed data showing consumer spending rose more than expected last month, stoking concern the U.S. economic recovery is faltering. President Barack Obama said his administration will consider additional stimulus measures, without giving details.

U.S. Treasuries rallied, clawing back ground from last week’s selloff. The yield on the benchmark 10-year note fell 12 basis points to 2.53% and the yield on 30-year bonds fell 11 basis points to 3.58%.

The S&P 500 declined 1.5% to 1048.92 and the Dow Jones Industrial Average dropped 1.4% to 10009.73. The Nasdaq Composite shed 1.6% to 2119.97.
Home Depot, the home improvement chain, led the Dow lower, falling 2.6%. Bank of America declined 2.5%.

Intel, the world’s biggest chipmaker, fell 2.2% after agreeing to buy Infineon Technologies’s wireless unit for about $1.4 billion.

Genzyme climbed 3.4% after rejecting a hostile US$18.5 billion cash offer from French drugmaker Sanofi-Aventis, saying it undervalued the company.

The yen advanced versus 16 major currencies as traders bet the Bank of Japan’s decision to ease access to credit – one of the few actions it can take with interest rates already near zero – won’t be enough to weaken its currency from near a 15-year high.

The dollar traded at 84.58 yen. A year ago, the greenback was at 108 yen. The BOJ added about 10 trillion yen of liquidity yesterday and Prime Minister Naoto Kan flagged a 920 billion yen stimulus package in efforts to pare back the yen’s strength.

Japan’s currency rose to 107.13 yen per euro, from 108.72. The greenback traded at $1.2663 per euro from $1.2763.

In Europe, the FTSEurofirst 300 Index declined 0.1% to 1025.48. Germany’s DAX 30 sank 0.7% to 5912.41. France’s CAC 40 fell 0.6% to 3487.01, though Sanofi gained 0.7%.

Copper for delivery in December climbed as much as 2.2% to US $3.46 a pound on the New York Mercantile Exchange, while New York crude slipped 0.6% to US$74.70 a barrel.

(BusinessDesk)

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