Dollar slumps to record low; Asian stocks decline
The dollar slumped to a record low today after a meeting of the finance chiefs of rich nations ended without words of support for the currency, while Wall Street weakness prompted a broad sell-off in Asian stocks.
Oil slipped from its record run on profit taking while gold fell as investors cashed in on its rally to a 28-year high on Friday.
Traders said shares took their cue from Wall Street, which saw its biggest fall in two months on Friday, a slide made more unnerving as it marked the 20th anniversary of the 1987 stock market crash. Several Asian markets, including Tokyo, fell more than 2%.
In the United States, lukewarm third-quarter earnings reports to date implied that corporate America has some thorny problems. For the stock market to get back on track, this week’s releases will have to offer Wall Street some more upbeat news.
Last week’s batch of earnings reports suggested that the fourth-quarter comeback that Wall Street bet on when it hit record highs earlier this month might not happen.
It wasn’t only banks and housing-related companies that revealed troubles. Big Dow components including 3M Co., Honeywell Inc. and Caterpillar Inc. posted third-quarter profit rises, but their outlooks were much dimmer than anticipated.
On Friday, stocks sold off sharply. The Dow Jones industrial average plunged 366.94 points, or 2.6%, to end at 13,522.02, its lowest since Sept. 17. For the week, the Dow lost 4.1%, the Standard & Poor’s 500 index finished down 3.9% and the Nasdaq composite ended 2.9% lower.
After disappointing profit reports from financial titans Citigroup Inc. and Bank of America Corp. last week, investors will be interested in how brokerage Merrill Lynch fared in the summer credit squeeze. Merrill reports quarterly results on Wednesday.
They will also be curious about technology names like Apple Inc., Microsoft Corp. and Motorola Inc. Until recently, technology stocks had been the stock market’s darlings.
Companies that depend on the housing market will be scrutinized closely too. Home builder Pulte Homes Inc. and mortgage lender Countrywide Financial Corp. release earnings this week.
Other Dow components reporting earnings include American Express Co., DuPont, Boeing Co. and AT&T; Inc.
Not many investors expect the housing market to bounce back soon. On Wednesday, the National Assn. of Realtors is expected to report that September existing-home sales fell.
On Thursday, the Commerce Department is expected to show that September new-home sales also declined.
The market hopes the broader economy is strong enough to keep growing, though, despite housing’s drag. A key measure of overall business spending -- durable goods orders -- is expected to show a rise in demand in September after August’s drop.
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At a glance
Today
Treasury bill auction.
Quarterly earnings reports due from Apple Computer, Netflix, American Express, Halliburton and Texas Instruments.
Tuesday
House Energy and Commerce subcommittee hearing on
improving consumer protection in dealings with telemarketers and on the Internet.
Quarterly earnings reports due from Juniper Networks,
Amazon.com, AT&T;,
Burlington Northern Santa Fe, DuPont, JetBlue Airways,
Lockheed Martin, New York Times and UAL.
Wednesday
National Assn. of Realtors
reports on existing-home sales for September.
House Financial Services
Committee hearing on
overhauling mortgage practices.
Senate Commerce, Science and Transportation Committee hearing on the radio market.
Senate Banking, Housing and Urban Affairs subcommittee hearing on international
accounting standards.
Quarterly earnings reports due from Amgen, Northrop
Grumman, Occidental
Petroleum, Symantec, Merrill Lynch, Anheuser-Busch, Pulte Homes, Tribune and WellPoint.
Thursday
Senate Commerce, Science and Transportation subcommittee hearing on sweatshop
conditions in the toy industry
in China.
Commerce Department reports on durable goods orders for September.
Commerce Department reports on new-home sales for
September.
Labor Department reports on weekly jobless benefit claims.
Freddie Mac reports on
mortgage rates.
Quarterly earnings reports due from Aetna, Alaska Air Group, Comcast, Dow Chemical,
Microsoft, Motorola and
U.S. Airways Group.
Friday
Quarterly earnings reports due from Countrywide Financial and Waste Management.
