Market Snapshot May 15, 2009, 4:40PM EST

Stocks End Week with Losses

(page 2 of 2)

Story Tools

Prudential Financial (PRU) and Hartford Financial Services Group (HIG) are among six insurers granted access to U.S. aid as the government moves to shore up an industry battered by investment losses. Hartford won preliminary approval for $3.4 billion in capital from the Treasury's Troubled Asset Relief Program. Prudential, Allstate (ALL), Principal Financial Group (PFG) and Ameriprise Financial (AMP) also are eligible for funds, said Andrew Williams, a spokesman for the Treasury. Lincoln National (LNC) said it may receive $2.5 billion.

In economic news Friday, the University of Michigan U.S. consumer sentiment improved to 67.9 in the preliminary May reading, after rising to 65.1 in the final April print. This is the highest since September and is a third straight month that confidence has picked up. The index was at 59.8 a year ago. The rebound in confidence is consistent with the slowdown in the economic contraction seen this quarter. All of the strength was in the future outlook component which climbed to 69.0 from 63.1 in April. It was 51.1 a year ago. The current conditions index dipped to 66.2 from April's 68.3 final. It was 73.3 a year ago.

U.S. industrial production fell 0.5% in April after a 1.7% drop in March (revised from -1.5%), a sixth consecutive monthly decline. Capacity utilization dipped to a record low 69.1 in April from 69.4% (revised from 69.3% previously). Mining output dove 3.2% after a 2.6% slide in March (revised from -3.2%). Manufacturing output dipped 0.3% vs. -2.1% in March (revised from -1.7%). Utilities rose 0.4% after a 1.9% jump in March (revised from 1.8% previously).

The U.S. Empire State index rose to -4.6 in May from -14.7 in April and much better than the -10.9 expected by markets. The pace of the contraction in regional manufacturing has declined for a third straight month. The employment index climbed to -23.9 from -28.1. However, new orders fell to -9.0 from -3.9. Prices paid roses to -11.4 -14.6. Prices received fell to -27.3 from -18.0. The 6-month ahead general business conditions index climbed further to 43.8 after jumping some 30 points to 33.1 in April. The 6-month employment outlook improved to 0.7 from -4.6.

The U.S. consumer price index (CPI) was flat in April after falling 0.1% in March, while the core rate rose 0.3% after a 0.2% rise in March. Markets expected a flat reading for the April headline and a tamer 0.1% rate for the core. On a year-over-year basis, the pace slowed to -0.7% from -0.4% for the overall index, and the biggest drop since 1955. However, ex-food and energy, inflation accelerated to 1.9% from 1.8% previously. Food prices fell 0.2% after a 0.1% decline in March. Transportation costs dipped 0.4% after a 1.1% decline previously. Energy prices fell 2.4% following a 3.0% March drop. Medical care costs rose 0.4% and education was up 0.3%, while tobacco climbed 9.3%, all weighing on the core price index.

Europe's economy contracted at a record 2.5% pace in the first quarter as companies cut output and jobs to survive the worst global slump in more than six decades. Bloomberg News said the drop in the gross domestic product in the 16-member euro region followed a 1.6% slide in fourth quarter, the European Union's statistics office in Luxembourg said. The first-quarter drop, which was the biggest since the euro-area GDP data were first compiled in 1995, exceeded the 2% decline economists expected in a Bloomberg News survey. Inflation held at 0.6% in April, a separate report showed. The deepest global recession since World War II is curbing European exports and eroding consumer demand, forcing companies to cut spending and jobs.