Wall Street closed lower Friday despite better than expected profit reports from Intel and JPMorgan. Banks led losses on concerns credit losses are only going to get worse.
In economic news, the Consumer Price Index increased 0.1% in December after a 0.4% rise the previous month. Forecasts were for an increase of 0.2%.
Meanwhile, the University of Michigan's consumer sentiment index increased from 72.5 in December to 72.8 in January, short of an expected rise to 74.
The Dow Jones dropped 100.90 points, or 0.94%, to 10,609.65, the S&P 500 shed 12.43 points, or 1.08%, to 1,136.03 and the NASDAQ fell 28.75 points, or 1.24%, to 2,287.99.
JPMorgan lost 2.3% after posting a quarterly profit of US$3.3 billion, easily beating estimates. However, the company missed revenue forecasts and also reported large losses on credit card and mortgage loans.
Bank of America and Wells Fargo fell 3.3% and 3.1%, while Citigroup and Morgan Stanley were both 2.6% cheaper by the close.
Intel weakened 3.2% after the chipmaker beat both quarterly earnings and revenue estimates having earned US40 cents per share on sales of US$10.6 billion.
Elsewhere in the tech sector, Apple, Google and Yahoo! lost between 1.7% and 1.8%.
Energy stocks lost ground after NYMEX light crude oil for February delivery fell US$1.39 to settle at US$78 a barrel.
Exxon Mobil and Chevron dipped 0.8% and 0.4%.
COMEX gold for February delivery fell US$12.50 to settle at US$1,130.50 an ounce.
European Markets
European stocks weakened to finish the week lower for the first time in a month. Banks and commodity stocks dragged on a day of broad based losses.
The UK benchmark FTSE 100 fell 42.83, or 0.78% 5,455.37, while the French CAC40 dropped 61.39, or 1.53% to 3,954.38. The German DAX shed 112.91, or 1.89% to 5,875.97.
Banks weakened on the back of JPMorgan’s rising losses on mortgages and commercial loans. Deutsche Bank, Commerzbank and Barclays fell 3.7%, 2.5% and 2.3% respectively.
Societe Generale and BNP Paribas dropped 2.7% and 3.7%.
Royal Bank of Scotland bucked the trend adding 2.1%.
Most energy stocks tracked the price of crude lower. Total and BG Group shed 2.4% and 0.5%.
There were broad based losses for the major miners. Xstrata fell 2.6%, while BHP Billiton and Rio Tinto lost 1% each.
Solar companies dropped on reports the German government plans to cut solar power incentives more than originally expected.
French retailer Carrefour rallied 3.6% after meeting fourth quarter sales expectations and reiterating profit forecasts for CY09.
Japanese Markets
The Nikkei continued to rally Friday as banking stocks came back into favour with investors as efforts to bolster their capital seemed to be coming to an end. Automakers also climbed while the commodity stocks capped gains.
The Nikkei 225 climbed 74.42, or 0.68% to 10,982.10.
Mitsubishi UFJ Financial Group rallied 3.5%. Sumitomo Mitsui Financial Group, the second biggest bank in the country, climbed 5.2%.
Mizuho Financial Group climbed 3.8%.
It was a good day for companies with Mitsubishi in the name as the familiar carmaker surged 7.5% on an upgrade to production estimates.
Toyota tacked on 1.6%, while Honda added 1.5%.
Chipmaker Advantest rallied 2.6% after its US rival Intel reported earnings which beat estimates.
The steelmakers, Nippon Steel and JFE Holdings lost 1.6% and 3.4% on the prospect of increased prices for iron ore.
Elsewhere cosmetics maker Shiseido spiked 5.1% after agreeing to buy US-based Bare Escentuals for US$1.7 billion.
Hong Kong Markets
Profit-taking sent Hong Kong stocks lower as the benchmark index recorded its first weekly decline in four weeks. Energy stocks tracked the price of crude lower.
The Hang Seng shed 62.79, or 0.29% to 21,654.16.
Oil companies Cnooc and PetroChina slid 1.1% each.
Bank of Communications and China CITIC Bank also lost 1.1% each.
Semiconductor Manufacturing International surged 5.9% on the back of Intel’s result and forecasts.
Mobile phone contract maker Foxconn International climbed 6.4%.
China Shipping Container Lines put on 0.9% on predictions of an increase in trans-Pacific cargos.
