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Daily Market Review – 20 February 2015

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Daily Market Review – 20 February 2015

Feb 20 2015, 8.35am GMT

STOCK.com

BP Fails To Reduce Oil Spill Fine

 

STOCK.com   Stocks

On Thursday, BP Plc’s (L:BP) attempt to reduce the civil fine that the company could be facing as a result of the Gulf of Mexico oil spill in 2010, was rejected by a judge in the U.S. on Thursday. Currently, under the Federal Clean Water Act, BP could be liable to pay a fine of $13.7 billion. As agreed by Carl Barbier, the U.S. District Judge in New Orleans, BP would need to pay a fine of $4,300 per barrel that was spilled while BP was attempting to reduce this amount to $9.57 billion or a maximum of only $3,000 a barrel. BP is being held accountable for a blowout which occurred at the Macondo oil well in April 2010 which killed eleven workers and caused the biggest offshore oil spill in the U.S. While BP is currently considering its legal options, Barbier has previously ruled that the company acted negligently and with willful misconduct and as a result, over three million barrels of oil were spilled. To date, BP has already spent over $42 billion in victim compensation, fines and cleanup. The shares of BP are currently trading at $41.19 a share.

STOCK.com   Indices

With Greece unable to come to an agreement with its creditors regarding loans as well as a decline in oil prices, U.S. stocks ended the trading session on Thursday marginally lower. Adding to investor uncertainty were the ambiguous comments by the Federal Reserve on Wednesday regarding the expected timeline for rate hikes. Despite this, the tech-heavy Nasdaq Composite index (COMP) defied the general downward trend and is now closing in on an all-time high it reached in March 2000. The Nasdaq closed up 0.4 percent, or 18.34 points, higher at 4,924.70. On the downside was the Dow Jones Industrial Average (DJIA) which declined 0.2%, or 44.08 points, to 17,985.77. The biggest decliner on the blue-chip index was Wal-Mart Stores, Inc. after the company missed its earnings estimates while their announcement to increase employee wages also negatively impacted the retail giant’s share price. Also on the downside was the S&P 500 index (SPX) which closed 0.1%, or 2.23 points lower, at 2,097.45. Gains were led by consumer discretionary and technology stocks while telecom and utilities stocks declined the most.

STOCK.com   Currencies

Despite mixed economic reports out of the U.S., the U.S. dollar (USD) held gains against most major currencies. Also, concerns regarding the debt in Greece continued to weigh on market sentiments. In their report, the Federal Reserve Bank of Philadelphia stated that the manufacturing index declined to 5.2 in February, a twelve month low, and down from January’s reading of 6.3. This missed analyst expectations for a rise to 9.3 this month. Elsewhere, the Department of Labor in the U.S. stated that the number of individuals filing for initial jobless benefits in the week ending on the 14th of February dropped to 283,000, down 21,000. This was a decline from the previous week’s total of 304,000. In currency trading, the EUR/USD traded at 1.1392. This small decline came in response to Greece’s inability to come to an agreement on its debt and its bailout extension request. Meanwhile, the greenback held steady against the British pound with GBP/USD at 1.5438 while USD/CHF traded at 0.9469, up 0.48 percent. Against the Japanese yen and the Australian dollar, the USD traded higher with USD/JPY up 0.13% at 118.93 and AUD/USD down 0.22% at 0.7792.

STOCK.com   Commodities

In Asian trading on Friday, crude oil prices climbed up after a two day drop. This came in response to expectations that a report from Baker Hughes (NYSE:BHI) today will show that the number of active oil rigs in the U.S. has declined. In its last weekly survey, Baker Hughes showed that the oil output in the U.S. was down to 9.2 million barrels a day and that the oil rig count in the country had fallen to its lowest number since August 2011. London Brent crude for delivery in April traded at $60.70 a barrel, up 49 cents while U.S. crude for delivery in March, which expires later in the day, was trading at $51.66 a barrel, up 50 cents.

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