Equities markets see declines

In Japan on Wednesday, the Tokyo equities markets were mixed but barely reacted to the decision by the Bank of Japan to raise interest rates to 0.5 percent. Still, the Topix managed to gain 0.3 percent to 1,787.23, its highest close in 15 years. The Nikkei 225, however, dropped 0.1 percent to 17,913.21. Banks saw advances after the announcement, as did real estate and retail, but export-focused shares did not see gains even though the yen weakened.

Europe’s equities markets were also lower as investors took profits. The FTSE Eurofirst 300 dropped 0.7 percent to 1,534.74 amid a mixed banking sector and declines in real estate. Brewers were also lower. Volvo (NASDAQ: VOLV; Stockholm Stock Exchange: VOLV A, VOLV B), however, added 1.8 percent to SKr567 on continued support for its bid for Nissan Diesel.

London markets were lower, with the FTSE 100 down 0.9 percent to 6,357.1 and the FTSE 250 0.4 percent lower to 11,543. Alliance & Leicester (LSE: AL) added 7.8 percent to £11.49 after its full-year report showed profits higher than expected and it announced a share buyback worth £300 million. Imperial Tobacco (LSE: IMT) gained on bids rumors, while PartyGaming (LSE: PRTY) gained on rumored criticism of a bill that made it illegal for US banks and credit card companies to process internet gaming payment transactions. Declines came among miners and the telecommunications sector.

Higher than expected inflation in January send Wall Street lower at midday. The Dow Jones Industrial Average was 0.4 percent lower to 12,733.92, while the Nasdaq Composite dropped 0.1 percent to 2,509.92 and the S&P 500 fell 0.3 percent to 1,455.57. Shares in the Sirius (NASDAQ: SIRI) and XM (NASDAQ: XMSR) satellite radio services were lower on doubts that regulators would let their proposed merger proceed. Subprime mortgage lenders were also lower, while JetBlue (NASDAQ: JBLU) regained some of Tuesday’s losses even though it said its first-quarter loss would be larger than expected after it was forced to cancel more than 1,000 flights due to bad weather in the past week.

Crude oil prices were higher due to closures that jeopardized supply and to increased tensions after Iran did not halt its uranium enrichment activities before a UN-imposed deadline. WTI breached the $60 per barrel level in afternoon trade in New York. Meanwhile, prices on precious metals followed oil higher and base metals prices were mixed.

In currencies trade, the yen declined after the Bank of Japan hiked interest rates but said that any further hikes would be “very gradual” which left most analysts expecting no more increases until after parliamentary elections in July. Sterling was also weaker, while the US dollar strengthened on the higher than expected rise in the consumer price index.

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