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Feb. 20, 2013 at 11:57 AM   |   0 comments

Stock indexes open flat Wednesday

NEW YORK, Feb. 20 (UPI) -- U.S. stock indexes were flat to lower on Wall Street Wednesday as housing starts for January came in lower than expected.

The U.S. Commerce Department said housing starts reached a seasonally adjusted annual rate of 890,000 in January, down from 973,000 in December and lower than the consensus prediction of 925,000.

In late morning trading, the Dow Jones industrial average gave up 21.73 points or 0.15 percent, to reach 14,013.94.

The Standard & Poor's 500 lost 6.59 points, or 0.43 percent, to 1,524.35 points.

The Nasdaq shed 16.73 points, or 0.52 percent, to 3,196.05 points.

The 10-year U.S. treasury rose 3/32 to yield 2.021 percent.

Against the dollar the euro fell to to $1.3346 from Tuesday's $1.3389. Against the yen, the dollar was higher at 93.58 yen from 93.57 yen.

In Tokyo, the Nikkei 225 closed at 11,468.28 points, adding 95.94 points or 0.84 percent.

In London, the FTSE 100 index added 0.15 percent, 9.64 points, to 6,388.71.


China banker: Dollar No. 1 reserve currency

LONDON, Feb. 20 (UPI) -- The U.S. dollar will remain the world's chief reserve currency for decades and likely increase in strength, a senior Chinese central banker wrote in a paper.

"The dollar's global dominance will continue," Jin Zhongxia, head of the research institute of the People's Bank of China, wrote in a personal commentary for the Official Monetary and Financial Institutions Forum, a London banking and financial-industry think tank.

His commentary can be found at tinyurl.com/Jin-Zhongxia.

Jin said the world was moving to a "1+4" global currency system.

"The dollar will continue to be the super reserve currency, supplemented by four smaller reserve currencies: the euro and the British pound in Europe, and the Japanese yen and the Chinese (yuan) in Asia," he said.

The dollar's global dominance reflects "U.S. economic, financial and military power," Jin said, and the currency has resilience to economic shocks that other key currencies, such as the euro, don't have -- as demonstrated by the eurozone debt crisis.

"The debt crisis in the euro area has demonstrated the structural weakness of this currency," he said. "If we take into consideration that the euro partially relies on the dollar's payments infrastructure for its cross-border transactions, we can say that the euro is basically a very large regional reserve currency.

"But the sheer size of the euro area economy and financial market, together with its highly advanced science and technology, will maintain the euro as the second most important international currency, behind only the dollar, in the foreseeable future," Jin said.


Apple says it was hacked

CUPERTINO, Calif., Feb. 20 (UPI) -- U.S. technology giant Apple said company computers were infected with a computer virus similar to one that recently attacked Facebook Inc.

Facebook said Friday that hackers had gotten past its security system in January. Apple said that a "small number" of its computers had been attacked with a "watering hole" virus, which is similar to the attack on Facebook, The Wall Street Journal reported.

The attack on Apple's computers displays at least two troublesome trends.

The first is that Apple computers were the target of attacks. Previously it had been a bragging point that Apple computers were rarely targeted by hackers.

The attack also shows that hackers aren't just looking for credit card numbers and other personal information. Facebook and Apple both said personal data weren't stolen, although a recent attack on Twitter may have allowed hackers access to 250,000 email addresses and user names.

Hackers may be after confidential company information, including product development plans, the Journal said.

Sources of security breaches are also in flux. A report scheduled for release Wednesday says research firm Trustwave Holdings Inc. investigated 450 data breaches in 2012 and that 33 percent were traced to hackers in Romania and 29 percent originated in the United States.


Japan Jan. trade deficit jumps to $17.3B

TOKYO, Feb. 20 (UPI) -- Recession-hit Japan Wednesday reported a record January trade deficit of $17.3 billion as imports jumped.

Provisional figures reported on Japanese Finance Ministry's website showed January imports rose 7.3 percent year-on-year to $68.6 billion, while exports rose 6.4 percent to $51.3 billion, leaving a deficit of more than $17 billion. In the same month of last year, the deficit was $15.83 billion.

Japan is the world's third-largest economy after the United States and China. The new government led by Prime Minister Shinzo Abe has been trying to lift the country out of its chronic deflation and boost exports through a number of stimulus measures.

These measures have helped bring down the value of the yen against the U.S. dollar, which should help boost exports as was evident in the January figures. But a weaker yen, which has fallen more than 12 percent since January of last year, also makes imports more expensive.

January imports rose for the third straight month as oil product imports jumped 33.7 percent and liquefied natural gas rose 11.4 percent, Kyodo News reported, quoting the Finance Ministry.

Japan ended 2012 with a record trade deficit of $78 billion.

Part of the reason for Japan's rising trade deficit is its growing territorial dispute with China over the Senkaku Islands in the East China Sea, which both claim. The dispute has led to violent protests in China, hurting Japanese exports and adversely affecting bilateral trade, which before the dispute averaged more than $340 billion annually.

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