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US stocks close lower over bleak news on employment, home sales

Thursday, September 6, 2007

US stocks closed lower Wednesday after an index of existing home sales fell to September 2001 levels and a gauge of employment prompted downward revisions two days before the government's payrolls report for August.

Bond prices soared as investors again sought the safety of government debt, sending yields to multi-month lows. The yield on the 10-year Treasury note, which moves inversely to its price, fell to 4.47 percent, its weakest level since March 14, and down from 4.56 percent at Tuesday's close.

The National Association of Realtors said pending sales of existing homes fell in July to the lowest level in nearly six years. Though the report did support the argument for a rate cut, it also worried investors who are nervous about the housing market growing so weak that it drags the economy into recession.

The late-session release of the Federal Reserve's Beige Book, which found the credit crunch and financial market turmoil had little impact on economics through the end of August, did little to appease the bearish sentiment, with the major indexes retaining the bulk of their losses. Wall Street appeared disappointed that the Beige Book's findings didn't deliver a sure-bet for a rate cut, which markets have been pining for.

At the New York Stock Exchange, volume neared 1.4 billion shares, with declining stocks outpacing advancing issues 3 to 1. At the Nasdaq, more than 1.9 billion shares traded hands as decliners topped advancers by a ratio of more than 2 to 1.

The Dow ended down 143.39, or 1.07%, at 13,305.47, after having fallen as much as 200 points in the session. Broader stock indicators also lost ground. The Standard & Poor's 500 index fell 17.13, or 1.15%, to 1,472.29, and the Nasdaq composite index fell 24.29, or 0.92%, to 2,605.95. The dollar was mixed against other major currencies, while gold prices slipped.

All Indian ADRs end in red; VSNL, Patni fall more than 4%

All Indian ADRs ended in the red as US markets fell after good rally for a week. VSNL, Patni Computers were the major losers, down more than 4%. In the technology pack, Infosys Technologies was down 1.52% at 47.88, Patni Computers was down 4.71% at 24.05, Satyam Computers was down 1.7% at 24.93, while Wipro ended the day 3.12% at 14.29.

In the non-technology pack, HDFC Bank was down 2.41% at 86.37, VSNL was down 4.46% at 19.72, ICICI Bank was down 2.21% at 44.24, MTNL was down 0.85% at 6.99, Tata Motors was down 0.3% at 16.84, Dr Reddy's Lab was down 0.61% at 16.18 and Sterlite was down 0.88% at 15.85.

Posted by FR at 9:39 AM  


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