Alcoa Earnings, Sears Outlook Lift Wall Street; Greece, Italy Raise

Bikram Pandey
11 Jan, 2011
New York City

U.S. stocks edged higher after Alcoa, Sears and Lennar meet or exceed investors

[R]4:00 PM New York – U.S. stocks edged higher after Alcoa, Sears and Lennar meet or exceed investors’ expectations. Gold, copper and crude oil gain as investor sentiment in Europe improve after Greece and Italy complete the sale of bonds and Japan offered to invest in euro-zone bonds.[/R]

U.S. indexes gained after Alcoa swung to profit for the last quarter and the year and Sears guided higher than expected earnings and home builder Lennar reported better than expected earnings. The euro appreciated against the dollar and crude oil and copper gained.

The European indexes rose after Japan pledged to buy euro-zone bonds. Portugal said it does not need bailout as the nation prepares to raise 1.25 billion euros tomorrow. French business sentiment improved in December. Greek CPI inflation soared in December.

Greece sold today 1.95 billion euros of six-month bills at 4.90% yield and Italy sold 7 billion euros of one-year bonds that yielded 2.07%. Both bond offerings were completed at slightly higher yields.

The UK indexes edged higher after retail sales fell in December and tracking market gains in Europe. Japan and China expressed their willingness to participate in a euro-bond offering that will support Portugal and Ireland. Hamworthy secured Brazilian contract for £30 million. Logica-led consortium secured £157 million outsourcing deal.

Stocks in Tokyo trading declined after reaching eight-month high last week. Japan plans to but euro-zone debt as the European Union prepared to float bonds to pump capital in the struggling economies. The latest survey shows a decline in adult population reaching the age of 20 years.

Stock indexes in Shanghai rally 0.5% and in Hong Kong surge 1%. China’s foreign exchange reserves reach a record $2.84 trillion in 2010. China Railway Materials Commercial Co plans a dual listing in Shanghai and Hong Kong to raise $1.8 billion.

Mumbai stocks declined on the sixth day, the longest streak in more than a year as investors worry the government may not be able to arrest inflation as Prime Minister Singh conveys a cabinet meeting. Gujarat in a two-day investment summit is expected to announce $20 billion of port development projects.

Australian coal trade is severely disrupted and fears are rising that the impact on wider economy may be larger than anticipated. Rising flood waters enter the city of Brisbane, the third largest city. Trade surplus in November narrowed to $1.925 billion.

Commodities, Currencies and Yields

Dollar declined against euro to $1.297 and rose against the Japanese yen to 83.23. One UK pound fetched $1.56.

Crude oil increased $1.93 to $91.18 a barrel for a front month contract, natural gas edged higher 0.8 cents to $4.48 per mBtu and gasoline increased 2.41 cents to 247.84 cents.

Gold increased $8.70 in New York trading to close at $1,382.80 per ounce, silver increased $0.70 to $29.56 per ounce and copper for the front month delivery increased 8.05 cents to $4.34 per pound.

Yield on 10-year U.S. bond increased to 3.34% and on 30-year U.S. bond yield gained to 4.49%.