(As of 7:29 am pacific)
Stocks open Friday in a downward trend led by JP Morgan
Chase after the banking giant reported in an unexpected conference call
yesterday that a $2 billion trading loss due to a large position in credit
default swaps will effect Q2 results.
Shares of JP Morgan fell 9.17% in early trading. Stocks rallied back paring early morning
losses as markets filtered other economic data.
The Labor dept. released data showing the Producer Price Index (PPI)
fell 0.2% in April, the biggest decline since October. The drop was led by falling gas prices at the
end of April. The unadjusted 12 month
rise of 1.9% was the weakest since October 2009. Factoring out volatile food and energy
prices, the core PPI edged up 0.2% for April.
In Europe, stocks were down as the European Commission said in its
Spring forecast Friday that the Euro-zone was in a “mild recession”. They also projected gross domestic product
for 2012 to contract by 0.3%, and would rebound to grow 1% in 2013. They expect unemployment to remain high, near
11%. In China, economic data for April
came in weaker than expected indicating a continued economic slowdown. China’s industrial output rose 9.3% in April,
missing estimates of 12.2%, while retail sales were up 14.1%, shy of analysts
estimates of a 15.1% rise. The Hang Seng
Index fell 1.3% after the data was released.
Chinese CPI rose 3.4% from a year earlier, but was down 0.1% month over
month showing signs slowing inflation and cooling in prices. Oil fell 0.77% to 96.33 while gold also
dropped 0.41% to 1589. The US dollar was
mixed and the 10 yr. treasury yield fell to 1.84%. 30 yr. mortgage rates remained at 3.78%. The CBOE volatility index (VIX), was up 1.96%
to 19.20 at 7:28 am pacific.
