United States markets opened lower on Friday, with utilities and consumer goods companies leading stocks down.þþKEEPING SCORE The Dow Jones industrial average fell 0.74 percent and the Standard & Poor’s 500-stock index was down 0.79 percent. The Nasdaq composite index dropped 0.69 percent.þþEARLY MOVERS Utilities stocks lagged the market as bond yields moved higher. Energy stocks also fell as the price of oil gave back some of its recent gains. Shares of NRG Energy fell 2.8 percent and Transocean stock fell 2.6 percent.þþEUROPEAN MARKETS In Germany, the DAX fell 0.7 percent and in France, the CAC 40 lost 0.8 percent. The FTSE 100 was down 0.7 percent in Britain.þþEUROPE FACTOR A major reason for the negative tone in stock markets was Thursday’s decision by the European Central Bank to not extend the duration of its stimulus program. The central bank president, Mario Draghi, also seemed less inclined to expand on the existing stimulus measures anytime soon.þþNORTH KOREA ANGST Also weighing on sentiment was the news that North Korea had conducted a nuclear test explosion on Friday that it said would allow it to build “at will” an array of stronger, smaller and lighter nuclear weapons. It was North Korea’s fifth atomic test and the second in eight months. South Korea’s president called the detonation, which Seoul estimated was the North’s largest in explosive yield, an act of “fanatic recklessness.” Japan called North Korea an “outlaw nation.”þþASIA’S DAY Concerns over the test hit shares in South Korea, where the Kospi fell 1.3 percent. The Nikkei 225 was little changed in Japan, while in Hong Kong, the Hang Seng gained 0.8 percent. The Shanghai composite index slipped 0.6 percent in China. In Australia, the S.&P./ASX 200 lost 0.9 percent.þþANALYST’S TAKE “European markets are continuing where they left off, with the downbeat sentiment driven by E.C.B. inaction dampening expectations of further easing in forthcoming meetings,” said Joshua Mahony, a market analyst at IG. “With Asia still reeling from the safety implications of North Korea’s latest foray into nuclear weaponry, we are seeing the tone set by a largely gloomy Asian session.”þþENERGY Oil prices lost some of their overnight surge, which was prompted by a report indicating fuel stockpiles fell precipitously last week. Benchmark United States crude oil shed $1.04, to $46.58 a barrel in New York while Brent crude, used to price international oils, lost $1.19, to $48.80 in London.þþBONDS AND CURRENCIES Bond prices fell. The yield on the 10-year Treasury note rose to 1.65 percent. The euro remained solid after the European Central Bank’s inaction and was trading 0.1 percent higher at $1.1267. The dollar rose 0.2 percent to 102.73 yen.
Source: NY Times
