Nasdaq Jumps 1.2% on Google, Microsoft Earnings; GE Trims Outlook

Nichole Harper
19 Apr, 2013
New York City

Tech heavy Nasdaq led the market indexes on Wall Street with a surge of 1.2%. Earnings dominated trading sentiment after Google and Microsoft reported better than expected earnings and IBM fell short of expectations.

[R]12:40 PM New York – Tech heavy Nasdaq led the market indexes on Wall Street with a surge of 1.2%. Earnings dominated trading sentiment after Google and Microsoft reported better than expected earnings and IBM fell short of expectations.[/R]

U.S. stocks traded higher after a batch of positive earnings from tech companies and investors took comfort in G20 avoided a direct criticism of monetary stimulus in Japan.

The S&P 500 index increased 11.3 or 0.7% to 1,553 and the Dow Jones Industrial Average declined 9.4 or 0.1% to 14,528.

The weakness in IBM weighed on the Dow after the technology giant reported quarter earnings of $3 a share, missing the estimate of $3.05 a share and higher. IBM stock fell 6.5%.

The tech heavy Nasdaq gained 1.25% or 39.59 to 3,205.76 after Google and Microsoft reported better than expected earnings.

April gold futures increased 0.8% to $1,402.60 an ounce and May crude-oil futures increased 0.5% to $88.42.

European Markets

European stocks inched higher Friday after resource stocks recovered and twenty nine banks are scheduled to repay early 10.94 billion euros of loans to the European Central Bank.

The FTSE 100 index in London rose 0.27% or 16.89 to 6,260.56 as commodities linked stocks rebounded. Vedanta Resources, Tullow Oil, Randgold and Anglo-American plc rose between 2% and 5%.

In Frankfurt, the DAX index fell 0.2% to 7,457.47 and the CAC 40 index in Paris gained the most, up 0.81% or 28.99 to 3,628.35.

Shares of GlaxoSmithKline, drug maker, fell 0.75 % in London after the Office of Fair Trading accused the firm of paying competitors to delay release of their own versions of GSK Seroxat treatment.

Asian Markets

Stocks in Tokyo traded higher after G-20 ministers failed to criticize the Japan’s monetary easing.

The yen weakened to 98.69 against one dollar.

The Nikkei 225 Stock Average gained 96.41 or 0.7% to 13,316.48 and the broader Topix Index rose 3.70 to 1,126.67.

With the tacit approval of the latest Japanese monetary easing from the G20 ministers, market watchers expect additional gains in the Nikkei in the next two weeks and the expectations of better earnings remain high.

A draft statement to be released at the end of meeting in Washington today is expected to avoid direct criticism of the stimulus, Finance Minister Taro Aso said.

Market indexes in Hong Kong and Shanghai increased more than 2% after International Monetary Fund reiterated that China’s economy remains on track to grow 8% in the current year.

Stocks in Review

Shares of PepsiCo ((PEP)) and Mondelez ((MDLZ)) gained more than 2% after hostile investor Nelson Peltz has been increasing his stake in companies through his Trian Fund Management LP.

Investor Pelz increased revealed a stake worth $269 million in Pepsi and a stake in Mondelez.

McDonald’s ((MCD)) declined 2% after the greasy fast-food chain operator reported flat first quarter and same-store sales declined in the U.S. amid soft global demand.

Chipolte Mexican Grill ((CMG)) soared 9% after the fast food chain reported earnings ahead of expectations.

Mexico based Groupo Modelo and Anheuser-Busch InBev finalized a settlement with the Justice Department that pave the way for the merger between the two beer makers to proceed.

General Electric ((GE)) decreased 4% after the diversified conglomerate reported first quarter profit that matched expectations but sales in power & water and oil and gas businesses were hurt by the weakness in Europe.

Google Inc ((GOOG)) increased 2.4% after the most visited search engine posted first quarter profit excluding certain items of $11.58 a share, ahead of most expectations of $10.55.

Microsoft Corp ((MSFT)) increased 4% after the software maker reported third quarter net income increased 19% to $6.06 billion or 72 cents a share.

Honeywell International Ltd ((HON)) increased 3% after the aviation and thermal controls maker reported first quarter net income of $966 million or $1.21 a share, beating the expectations of $1.14 a share.

Dell Inc ((DELL)) declined 3.4% after the leverage buyout company Blackstone said it abandoned its effort to top the bid by the company founder.