Home' Trinidad and Tobago Guardian : July 12th 2015 Contents JULY 12 • 2015 www.guardian.co.tt SUNDAY BUSINESS GUARDIAN
STOCKS | SBG9
US stocks logged their best day
in two months Friday as
Greece appeared to move
closer to securing a bailout
deal that will enable it to
avoid bankruptcy and keep
the country in the euro.
Greece and its creditors appeared to be nar-
rowing their differences after Athens offered
reform proposals in order to secure a third
bailout of around 53 billion euros (US$59.5
billion). A final decision could be made on
A second day of gains for Chinese stocks
also encouraged investors. US stocks had fallen
sharply on Wednesday, in part on concern
that a monthlong slump in China s stock mar-
ket could crimp growth in the world s sec-
"This is a giant collective exhaling," said
Kristina Hooper, US investment strategist at
Allianz Global Investors. The Greek deal "is
not done, but we re closer than we have been
in a while."
The Standard & Poor s 500 index rose 25.31
points, or 1.2 per cent, to 2,076.62. The Dow
Jones industrial average climbed 211.79 points,
or 1.2 per cent, to 17,760.41. The Nasdaq com-
posite gained 75.30 points, or 1.5 per cent, to
The gains pushed the S&P 500 back into
positive territory for the year.
On Friday, stocks in China jumped before
the US market opened. China s Shanghai Com-
posite Index jumped 4.5 per cent, paring its
losses for the month to 24 per cent.
The Chinese market is only recovering after
the government intervened heavily and about
half of the companies listed in mainland China
suspended trading in their stocks.
That s making some investors cautious.
"The policy makers appear to have some
success in stabilising values, but fifty per cent
of Chinese stocks are not currently trading,"
said Jim McDonald, chief investment strategist
at Northern Trust.
Back in the US, airline stocks rallied after
American Airlines, the nation s largest carrier,
signaled that it was cutting back on its growth
plans this year amid signs that average fares
are declining. American said it expects to
increase passenger-carrying capacity by 1 per
cent this year, down from an earlier forecast
of two per cent. American Airlines rose
US$1.54, or 3.9 per cent, to US$41.21. Delta
Air Lines jumped US$1.91, or 4.7 per cent, to
Investors also followed a speech by Federal
Reserve Chair Janet Yellen on Friday.
Speaking in Cleveland, Ohio, Yellen said
that the Fed is on track to start raising interest
rates later this year, but expressed concerns
over headwinds that are still holding back the
US economy, in particular lingering weakness
in the labor market and new potential threats
David Kelly, chief global strategist at JPMor-
gan Asset Management, said after the speech
that he expected the Fed to lift interest rates
in September, provided that Greece reaches a
deal with its creditors and there were no major
financial crises between now and then.
Investor start focusing on second-quarter
earnings next week as the pace of company
reporting picks up.
Among the companies reporting are banks,
including JPMorgan, Bank of America and
Wells Fargo, as well as Delta, Netflix and Intel.
"Earnings will be adequate, we don t expect
them to blow out the lights," said Allianz s
Hooper. "It will be a subdued, but mildly pos-
itive earnings environment."
Companies in the S&P 500 are forecast to
report that earnings shrank by 4.5 per cent
on average. While that would be the first con-
traction in earnings in almost six years, the
figures are distorted by a big drop in energy
company earnings following the collapse in
the oil price last year.
In bond trading, prices fell. The yield on
the 10-year Treasury note climbed to 2.40 per
cent from 2.32 per cent on Thursday. The euro
surged against the dollar, climbing 0.7 per cent
The dollar rose 0.7 per cent against the
Japanese currency, to 122.80 yen.
The price of oil declined slightly and ended
the week down seven per cent on concerns
about economic growth in Europe and China
as well as robust production from US drillers.
Benchmark US crude fell 4 cents to close at
US$52.74 a barrel in New York. It ended last
week at US$56.93 a barrel. Brent crude, a
benchmark for international oils used by many
US refineries, rose 12 cents Friday to close at
US$58.73 a barrel in London.
In metals trading, silver rose 12 cents to
US$15.47 an ounce. Gold dropped US$1.30 to
US$1,157.90 an ounce. Copper fell 1.3 cents
to US$2.55 a pound.
In other futures trading on the New York
--- Wholesale gasoline fell 2.8 cents to close
at US$2.017 a gallon.
--- Heating oil fell 0.4 cent to close at
US$1.740 a gallon.
--- Natural gas rose 4.4 cents to close at
US$2.770 per 1,000 cubic feet.
Asian stock rose for a second day on Friday
as the Greek government proposed a
broad financial overhaul to its creditors
and Beijing s attempts to arrest a sharp
slide in the Chinese market appeared to
be working. But most Asian markets were still in the
red from a week earlier.
KEEPING SCORE: China s Shanghai Composite
Index jumped 6.6 per cent to 3,954.83. The index was
up 1.1 per cent from one week earlier. Gains in other
markets were moderate. Japan s Nikkei 225 added 0.4
per cent to 19,934.43 and South Korea s Kospi advanced
0.3 per cent to 2,033.11. Hong Kong s Hang Seng index
rose 2 per cent to 24,883.44 while Australia s S&P/ASX
200 gained 0.6 per cent to 5,506.00.
CHINA SURGE: Chinese stocks jumped for a second
day following a three-week slide that authorities tried
to arrest with increasingly desperate support measures.
The Shanghai Composite Index has dived about 30 per
cent from its June 12 peak. In the latest move to stabilise
the market, the China Securities Regulatory Commission
said late Wednesday that it had ordered investors holding
more than five per cent of a company s shares not to
sell any of their holdings for the next six months.
ENERGY: Benchmark US crude fell rose 29 cents
to US$53.07 a barrel in electronic trading on the New
York Mercantile Exchange. The contract gained US$1.13
to close at US$52.78 a barrel in New York on Thursday.
Brent crude, a benchmark for international oils used
by many US refineries, rose 36 cents to US$58.97 per
barrel in London.
CURRENCIES: The euro strengthened to US$1.1091
from US$1.1065 in the previous global trading session.
The dollar rose to 122.01 yen from 121.71 yen. AP
Trader Mark Puetzer, centre, works on the floor of the New York Stock Exchange, Thursday,
July 9, 2015 in New York. US stocks opened with big gains, bouncing back from a loss the day
before, as investors hoped that last-ditch talks would produce an agreement between Greece
and its creditors. (AP)
A Chinese investor walks past displays of stock information in a brokerage
house in Beijing, Friday, July 10, 2015. Asian stocks rose for a second day on
Friday as the Greek government proposed a broad financial overhaul to its
creditors and Beijing's attempts to arrest a sharp slide in the Chinese market
appeared to be working. AP
Asia stocks gains as creditors narrow differences
How the Dow Jones industrial
For the day:
The Dow Jones industrial average rose
211.79 points, or 1.2 per cent, to 17,760.41.
The Standard & Poor's 500 index gained
25.31 points, or 1.2 per cent, to 2,076.62.
The Nasdaq composite climbed 75.30 points,
or 1.5 per cent, to 4,997.70.
For the week:
The Dow is up 30.30 points, or 0.2 per cent.
The S&P 500 index is down 0.16 points, or
0.01 per cent.
The Nasdaq is down 11.52 points, or 0.2 per
For the year:
The Dow is down 62.66 points, or 0.4 per
The S&P 500 index is up 17.72 points, or 0.9
The Nasdaq is up 261.64 points, or 5.5 per
US stocks rise
that Greek debt
deal will be done
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