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Wall Street closed lower Wednesday after the release of disappointing housing data made investors nervous in regards to an economic recovery. A weaker greenback pushed gold prices to all-time highs. 

In economic news, housing starts dropped more than 10% to an annual rate of 529,000 in October. It was the lowest reading in six months and below the forecast 600,000 annual rate. The government report also revealed the annual rate of housing permits slipped 4% to 552,000 in October from 575,000 the previous month. Forecasts were for an increase to 580,000.

Meanwhile, in a separate government report its Consumer Price Index increased a slightly higher than anticipated 0.3% in October. The Core CPI rose 0.2%.

The Dow Jones lost 11.11 points, or 0.11%, to 10,426.31, the S&P 500 slid 0.52 points, or 0.05%, to 1,109.80 and the NASDAQ fell 10.64 points, or 0.48%, to 2,193.14.

Bank of America climbed 3.7%, while Wells Fargo and Citigroup gained 1.7% and 1.2% on a positive day for the financials.

Goldman Sachs added 0.2% after launching a $500 million initiative to prop up small business.

Tech stocks were mainly lower. Hewlett-Packard lost 1.6%, while IBM and Apple shed 0.4% and 0.5%.  Microsoft bucked the trend, adding 0.4%.

Salesforce.com fell 3.1% after its quarterly report revealed a slowdown in new business contracts.

Autodesk slumped 10.4% after missing fourth-quarter earnings forecasts.

Hershey shed 2% as it looks at options with Ferrero regarding a possible joint bid for British chocolate maker Cadbury.

Home builders Pulte Homes and Lennar added 4.6% and 0.7% despite the disappointing housing data.

Colgate-Palmolive jumped 3.7% on media reports of a possible merger with Reckitt Benckiser Group.

NYMEX light crude oil for December delivery rose US44c settle at US$79.58 a barrel. Exxon Mobil and Chevron put on 0.3% and 0.1%.

COMEX gold for December delivery gained US$1.90 to a record close of US$1,141.30 per ounce.  

European Markets

European markets were relatively flat as weaker than expected housing starts in the US countered a rally among mining stocks. Mobile telecommunications stocks suffered the largest falls.

The UK benchmark FTSE 100 dipped 3.80 points, or 0.07% to 5,342.13. The French CAC40 edged 0.90 points lower, or 0.02% to 3,828.16, while the German DAX gained 9.18 points, or 0.16% to 5,787.61. 

Resource stocks rallied as copper rose to a 13-month high. The European Basic Resources Index has rallied 94% this year to date.

Xstrata jumped 4.8%, while the world’s first and third largest miners BHP Billiton and Rio Tinto put on 1.6% and 2.4%. Antofagasta advanced 1.9%.

Gains were not as strong among the energy stocks. BG Group, Royal Dutch Shell and BP added between 0.1% and 0.3%.

Total shed 0.3%. 

Financials were mixed with Royal Bank of Scotland and Lloyds the major movers, having lost 3.5% and 1.6%. Insurer AXA put on 2.9%.

Vodafone and Cable & Wireless dropped 2.7% and 3.4%, while Deutsche Telekom weakened 0.6%.

Marks & Spencer climbed 5.9% following the appointment of William Morrison Supermarkets CEO Marc Bolland as the clothing retailer’s new CEO. William Morrison shares sank 4.9% after Mr Bolland’s resignation.

Cadbury gained 1.2% on reports Ferrero and Hershey are considering making a bid for the chocolate maker that would exceed that of Kraft.

Bayer shed 2.8% after International Petroleum Investment Co. denied a report the German drugs maker is an acquisition target.

Japanese Markets

Investor confidence took a hit in Japan yesterday with the specter of capital raising and ratings downgrades looming large. Japan Airlines hit 7-year lows, while the banks also weighed.

The Nikkei 225 dipped 53.13, or 0.55% to 9,676.80.

Among the banks, Mitsubishi UFJ lost 0.6%. The bank posted a 59% jump in quarterly profit but still thought it necessary to tap the market for US$11 billion in a capital raising.

Sumitomo Mitsui Financial Group slumped 5.9%, while the third largest bank Mizuho Financial Group lost 2.4%.

JAL lost 3.9% on reports it would be denied bankruptcy protection. This came despite reports private equity firm TPG would invest US$1.1 billion – about the same amount it took out of Australia following the Myer float.

Property developers were heavily sold, Mitsubishi Estate shed 4.5%, while Mitsui Fudosan slumped 3.8%.

Heavy machinery maker, IHI Corp lost 3.8%.

Among the autos, Toyota lost 0.6%, while Honda dipped 0.8%.

Hong Kong Markets

Hong Kong stocks lost ground as investors locked in profits after a prominent adviser said the country, among others, was facing market bubbles. Financials and property stocks took the most points off the index.

The Hang Seng shed 73.82, or 0.32% to 22,840.33.

Bank of China and China Construction Bank fell 2% and 0.7%, while HSBC dropped 1.5%.

Singamas Container slumped 10.5% as it resumed trading following the announcement the company would tap the market for capital.

Property stocks Hang Lung Properties, China Overseas Land & Investment and Sino Land fell 3%, 2.1% and 1% respectively.

China Mobile rose 2.5% after it was announced the world’s largest mobile carrier by subscribers would carry Dell’s smartphone products.

Melco International dropped 3.8% after the company reported quarterly losses at its Melco Crown Entertainment increased. 

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