Stocks are heading down this morning after the Chinese economy grew slower than expected.
Despite encouraging data on exports and imports, China's economy only grew at an annualized pace of 7.7% in the first quarter, missing forecasts of 8%. In the fourth quarter of last year, China's gross domestic product rose 7.9% over the year-earlier period. Beijing also released data showing that industrial production grew slower in March than in the previous two months, rising 8.9%, while retail sales were up 12.6% from the year earlier, a slight improvement over January and February.
The disappointing Chinese data rocked commodities and global equities this morning. West Texas Intermediate oil futures are down 2.41% at $89 per barrel and copper dropped 3.4% to $323/lb. European and Asian stock markets are in negative territory and US stock futures also declined. Dow
(INDEXDJX:.DJI) futures are down 0.29% at 14,741 and S&P
(INDEXSP:.INX) futures sank 0.40% to 1,575.50. Nasdaq
(INDEXNASDAQ:.IXIC) futures retreated 0.37% to 2,835.75.
Precious metals futures continued to drop today. Gold fell 6.37% to $1,410.30 an ounce and silver declined by 9.4% to $23.58 per ounce. The sell-off of gold might be due to the Eurogroup's pressure on Cyprus to sell its gold reserves to help pay for the bailout.
The bearish sign from China also hit mining companies that supply industrial commodities. Freeport-McMoRan
(NYSE:FCX), the largest publicly traded copper miner, declined 4% this morning.
(NYSE:C) reported this morning that it earned more than expected in the first three months of 2013. The bank earned $1.23 per share on $20.5 billion in revenue as it cut costs and saw strong loan demand and an increase in investment banking profit.
(NASDAQ:DISH) placed a bid for Sprint Nextel
(NYSE:S) to challenge a previous bid by Japan's Softbank
(TYO:9984). The satellite TV company offered $25.5 billion, or $7 per share in cash and stock, for 32% of Sprint. This is a much higher premium for Sprint's shares than Softbank's $20 billion offer for 70% of shares. In pre-market trading, Sprint rose $15.59% to $7.19.
No positions in stocks mentioned.
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