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Forex · News · USMarket

NEWS / USMarket

USmarket Despite some letdown of growth, key indexes keep stable

11:47 01/11/2006

On a background of the anxieties connected with possible letdown of growth of the companies’ profits, caused by disappointing Alcoa financial results, yesterday shares on Wall Street opened with decrease.

 

Let's remind that the net profit of the world's largest aluminium manufacturer decreased on 16 % in 4 quarter, 2005 because of growth of energy expenses.

 

" There will be a search of shares in the market which will move forward in January, - Rick Makler from LibertyView Capital Management told. - Now, actually, a question of the leader change is more important than the ups and downs of the market".

 

Thus the market has not reacted significantly to the publication of wholesale trade inventories data of the US Department of Commerce. We shall remind that inventories rose on 0.4 % in November in comparison with October that is in line with analysts’ forecasts.

And durable order inventories, which service life makes up not less than three years, increased on 0.6 % in monthly calculation in November.

And wholesales have fallen on 0.7 % that became the maximal reduction since April, 2003.

The ratio of inventories and sales made up 1.15 months in November in comparison with 1.14 months the last month.

Let's also remind that the fourth part of total amount of inventories in the USA falls to the share of wholesale warehouses.

 

Michael Englund, Action Economics group economist notices: "We assume that the first and second quarters will not be so successful, that will force manufacturers to increase output. For two or three quarters the companies should work hard to supply the demand".

 

The market’s participants has understood optimistically the statement of the US Minister of Finance John Snow who declared yesterday that budgeted deficiency of the USA would reduce due to decrease in expenses.

Besides Snow told that he waits for continuation of economic growth and greater capital investments of business in 2006.

"It will be possible to see the huge efforts of administration to restrain expenses", - Snow said.

 

Stabilization of the oil prices supports the stock market on a background of falling of fuel consumption because of warming in northeast of the USA.

On experts’ forecasts distillates stocks in the country rose on 1.7 % - up to 128.9 million barrels during a week from January, 1 till January, 6th.

So, yesterday on NYMEX on January, 10th cost of oil futures with delivery in February decreased on $0.13 - to $63.37 per a barrel.

And on today morning oil trades in area of $63.40 per a barrel.

 

As a result Dow-Jones index of New York stock exchange has fallen on 0.32 point and was closed at a level 11011.58. NASDAQ index has grown on 1.63 points and is at a level 2320.32. S&P 500 index has gone down 0.46 point and is at a level 1289.69.

Profitability of the US state obligations for 30 years has grown on 0.042 in comparison with the previous closing and makes up 4.607.

 

Despite some letdown of growth of key share indexes, we recommend keeping opened before purchase of Dow-Jones index futures. The purposes, mentioned before, hold good.

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