US stocks inch higher in early trading, day after sell-off

 

By Bernard Condon (Associated Press), Google via PhilStar

NEW YORK  — U.S. stock indexes are opening higher, a day after a sell-off prompted by worries about higher U.S. interest rates and a stronger dollar. The euro fell to its lowest level in 12 years.

KEEPING SCORE: The Dow Jones industrial average rose 64 points, or 0.4 percent, to 17,727 as of 10:07 a.m. Eastern time. The Standard & Poor's 500 gained five points, or 0.3 percent, to 2,050. The Nasdaq composite rose 15 points, or 0.3 percent, to 4,875.

EURO SLIDE: The euro fell to $1.0598, its lowest level since April 2003. The euro has been greatly affected by the prospect of higher U.S. rates. That's because the European Central Bank is trying to lower rates at the same time rates are poised to rise in the U.S. On Monday, the ECB started buying European government bonds to stimulate the economy of the 19-country eurozone, several months after the U.S. Federal Reserve ended its own bond-buying program.

"The next target sits at 1.0500, the March 2003 lows, and it remains a very short hop from there to parity," said Michael Hewson, chief market analyst at CMC Markets.

EUROPEAN STOCKS SURGE: In Europe, Germany's DAX jumped 1.7 percent while the CAC-40 in France rose 1.8 percent. Britain's FTSE 100 rose 0.2 percent.

ANALYST'S TAKE: "Bargain-hunters appear to be out in force," said Alastair McCaig, market analyst at IG. "Yesterday's triple-digit falls seen in European equity markets appear to have been quickly forgotten."

 

FED FEARS: On Tuesday, stocks in Europe and the U.S. were battered as investors worried about the prospect of the Federal Reserve's first interest rate rise in nine years. Those odds appeared to increase after the U.S. government reported a burst in hiring last month. Low interest rates and other monetary stimulus have helped the S&P 500 triple in price since the bull market began six years ago.

CHINA FOCUS: Industrial output in the world's second-biggest economy rose 6.8 percent in the first two months of the year, according to the official Xinhua news agency. The number was less than analysts expected. Retail sales and fixed-asset investment also disappointed.

China's economy is expected to slow further after growing 7.4 percent last year, the lowest growth rate in nearly a quarter-century.

ASIA'S DAY: Japan's Nikkei 225 gained 0.3 percent. South Korea's Kospi lost 0.2 percent and Hong Kong's Hang Seng slipped 0.8 percent. The Shanghai Composite Index in mainland China swung between gains and losses before edging up 0.2 percent.

ENERGY: Benchmark U.S. crude fell 11 cents to $48.20 a barrel on the New York Mercantile Exchange. Brent crude, a benchmark for international oils used by many U.S. refineries, rose six cents to $56.93 in London.

BONDS: Bond prices fell slightly. The yield on the 10-year Treasury note edged up to 2.14 percent.