World Markets Trade Higher on GE, Google Earnings and German Confidence

Bikram Pandey
21 Jan, 2011
New York City

U.S. stocks rallied in the early trade but struggled in the afternoon. Better than expected earnings from GE and Google lifted indexes and improved confidence in Germany also contributed to positive sentiment in Europe. Copper, coffee and cotton gained in commodities trading. Euro gained 0.8%.

[R]4:00 PM New York – U.S. stocks rallied in the early trade but struggled in the afternoon. Better than expected earnings from GE and Google lifted indexes and improved confidence in Germany also contributed to positive sentiment in Europe. Copper, coffee and cotton gained in commodities trading. Euro gained 0.8% against the dollar.[/R]

U.S. indexes rose after General Electric reported better-than-estimated earnings but Bank of America loss widened. Positive sentiments lifted market indexes in New York, Europe and China.

Base metals and agriculture commodities rose after the euro gained 0.8% against the dollar. Copper added 1% and coffee and cotton gained more than 2%.

GE shares surged 8% after continuing operations earnings rose 31% and sales increased 1%. The company also guided “significantly higher” tax rate in 2011.

St. Jude Medical reached a settlement with U.S. regulators. Google Inc quarterly revenues rose 26% and net soared 29% and also appointed co-founder as its chief executive.

Air Products and Chemicals first quarter revenues were increased 10% to $2.39 billion. Bank of America net of interest expense fell 11% to $22.6 billion. Google Inc. fourth quarter revenues increased 26% to $8.44 billion. General Electric fourth quarter revenues increased 1% to $41.38 billion.

The European indexes gained after German business confidence improved in January. Euro-zone consumer sentiment declined in January and current account deficit narrowed in the third quarter. French manufacturing confidence soared and Portugal PPI rose in December.

The UK indexes edged higher tracking the gains in U.S. and Asia. UK retail sales fell more-than-estimated impacted by heavy snowfall and higher prices. Ireland planned to levy tax on bankers' bonuses. Mouchel rejected Costain's revised offer and said significantly undervalues the business.

Resource linked stocks in Tokyo led the indexes lower 1.5% today and 2.4% for the week. Transport Ministry plans to allot more slots to Chinese airlines at western Japan airports. Toshiba wins a 30 billion yen order to supply railcar parts to Washington D.C and Chicago metro.

Shanghai Indexes gain for the day but dropped more than 2.7% in the week. China’s budget deficit in 2010 was 1.6% of GDP well below the official target of 2.8%. China plans to double consumption of natural gas by 2015.

Stocks in Mumbai moved in a narrow range to close lower for the day and gained 0.8% in the week. Jindal Steel & Power plans to export a million tons of iron ore concentrate from its Bolivian mine. BHEL net surges 31% in the third quarter.

Stocks in Sydney dropped 1% in the week dragged down by weak resource stocks. Shipments at Hay Point terminal drop 22% in December and QR National trims its profit target for the year by 21%. Woodside Petroleum revenues rise 20% on record production at its North West Shelf LNG project.

Commodities, Currencies and Yields

Dollar declined against euro to $1.359 and fell against the Japanese yen to 82.65. One UK pound fetched $1.599.

Crude oil decreased $0.19 to $89.40 a barrel for a front month contract, natural gas edged higher 0.15 cents to $4.71 per mBtu and gasoline increased 4.2 cents to 246.41 cents.

Gold fell $3.70 in New York trading to at $1,342.80 per ounce, silver increased $0.05 to $27.53 per ounce and copper for the front month delivery increased 4.70 cents to $4.31 per pound.

Yield on 10-year U.S. bond increased to 3.43% and on 30-year U.S. bond yield rose to 4.59%.