U.S. Stocks Down, Yen Up on Tokyo Quake

A trader works on the floor of the New York Stock Exchange in New York. Photographer: Ramin Talaie/Bloomberg

 

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April 7 (Bloomberg) -- A magnitude 7.4 earthquake hit 215 miles (345 kilometers) northeast of Tokyo, resulting in warnings of a possible tsunami. The quake was measured at a depth of about 25 miles and struck about 11:32 p.m. local time, the U.S. Geological Survey reported on its website. Bloomberg's Brian Fowler talks about the quake with Margaret Brennan on Bloomberg Television's "InBusiness." (Source: Bloomberg)

 

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April 7 (Bloomberg) -- Joerg Kraemer, chief economist at Commerzbank AG, discusses the outlook for today's European Central Bank interest rate decision. Kraemer talks with Deirdre Bolton on Bloomberg Television's "InsideTrack." (Source: Bloomberg)

Stocks fell, dragging the Dow Jones Industrial Average down from an almost three-year high, while Treasuries pared losses and the yen rose as another earthquake shook Japan. Crude oil topped $110 a barrel and gauges of commodities climbed to the highest levels since 2008.
The Dow slid 56.73 points, or 0.5 percent, to 12,370.02 at 1:42 p.m. in New York and the Standard & Poor’s 500 Index dropped 0.4 percent. The iShares MSCI Japan Index Fund, an exchange-traded security tracking the nation’s equities, lost 0.8 percent, paring a drop of as much as 1.7 percent after Japan canceled a tsunami warning. Ten-year Treasury note yields were little changed at 3.55 percent after rising earlier. The yen strengthened against 15 of 16 major counterparts.
Equities turned lower after a magnitude-7.1 aftershock, one of the strongest since the devastating earthquake March 11, struck Japan today 215 miles (345 kilometers) northeast of Tokyo. At least three nuclear facilities lost some outside power. Stocks also retreated amid growing concern an impasse over the federal budget may lead to a shutdown of the U.S. government.
“Investor pysches are a little fragile,” said James Dunigan, chief investment officer in Philadelphia for PNC Wealth Management, which oversees $108 billion. “It’s not surprising investors stepped to the sideline until they could find out whether this new earthquake would cause significant damage,” he said. “We’re working through the issues on the budget deal. That’s not a significant negative, but we’d probably like to see that resolved without a shutdown.”
Cisco Systems Inc., Alcoa Inc. and General Electric Co. lost more than 1.1 percent to lead the Dow’s drop after the earthquake.