NEW YORK, April 24 — US stocks rose for a second straight session in New York Tuesday, building on the prior day’s momentum following a round of mostly good corporate earnings, while European markets also rose.
Sentiment was upbeat across major world indices thanks to easing Middle East worries, while traders are keenly awaiting the release this week of more major earnings and key US inflation data.
On Wall Street, the broad-based S&P 500 advanced 1.2 per cent, while the tech-rich Nasdaq Composite Index jumped 1.6 per cent, and the Dow Jones Industrial Average finished up 0.7.
General Electric, Spotify Technology and Kimberly-Clark were among the companies posting strong gains after releasing quarterly reports.
Briefing.com described the broad gains as “follow-through buying” after a rough period that generated talk that the market was oversold on a short-term basis.
Tesla earnings came after the closing bell, and showed a big drop in quarterly profits, putting elevated pressure on the electric vehicle market that has led to deep cost-cutting.
But traders ignored the gloomy results, pushing up the company’s stock after hours by more than 7 per cent.
‘Good news’ in UK
In Europe, London’s FTSE 100 added 0.3 per cent on the session, while major indexes in Paris and Germany also finished higher.
“Good news as this is, it does highlight the sluggishness of the UK’s top equity index when compared to its US and European competitors,” said David Morrison, senior market analyst at financial services provider Trade Nation.
But, he added, “let’s not be too churlish as it could be we see the FTSE outperform its rivals in the years to come should investors seek out dividend-paying value stocks rather than techy growthy ones.”
The index has in recent weeks been lifted by a weakening of the pound, particularly against the dollar, as markets anticipate cuts to UK interest rates in the coming months thanks to slowing price rises.
A weaker pound benefits FTSE-listed British multinationals that make big earnings in foreign currencies.
Frankfurt and Paris stock markets won a lift from news of an improvement to business activity in the eurozone this month and closed 1.6 per cent and 0.8 per cent ahead, respectively.
Awaiting inflation data
Key data out of Washington this week will provide a fresh idea about the US Federal Reserve’s rate-cutting plans, particularly updates on US gross domestic product and monetary policymakers’ preferred gauge of inflation.
The personal consumption expenditures (PCE) index, due out Friday, comes after three months of above-forecast readings on US consumer prices that have seen investors lowering their outlook for Fed rate cuts this year.
Markets expect headline PCE inflation to rise 0.3 per cent in March from a month earlier, according to analysis by Briefing.com.
The so-called core measure of inflation, which strips out volatile food and energy prices, is expected to rise by the same amount, suggesting markets think the bumpy inflation path is likely to continue.
Key figures around 2015 GMT
New York - Dow: UP 0.7 per cent at 38,503.69 points (close)
New York - S&P 500: UP 1.2 per cent at 5,070.55 (close)
New York - Nasdaq Composite: UP 1.6 per cent at 15,696.64 (close)
London - FTSE 100: UP 0.3 per cent at 8,044.81 (close)
Paris - CAC 40: UP 0.8 per cent at 8,105.78 (close)
Frankfurt - DAX: UP 1.6 per cent at 18,137.65 (close)
EURO STOXX 50: UP 1.4 per cent at 5,008.17 (close)
Tokyo - Nikkei 225: UP 0.3 per cent at 37,552.16 (close)
Hong Kong - Hang Seng Index: UP 1.9 per cent at 16,828.93 (close)
Shanghai - Composite: DOWN 0.7 per cent at 3,021.98 (close)
Euro/dollar: UP at US$1.0703 from US$1.0656 on Monday
Dollar/yen: DOWN at ¥154.83 from ¥154.84
Pound/dollar: UP at US$1.2448 from US$1.2354
Euro/pound: DOWN at 85.96 pence from 86.24 pence
West Texas Intermediate: UP 1.8 per cent at US$83.36 per barrel
Brent North Sea Crude: UP 1.6 per cent at US$88.42 per barrel
— AFP
