U.S. Indexes Rebound as Investors Focus on Earnings

Nichole Harper
18 Jul, 2014
New York City

Stocks on Wall Street rebounded after investors shifted focus to domestic earnings. Google net rose but the search engine operator struggled to monetize mobile platform traffic. General Electric met earnings expectations and IBM sales declined.

[R]12:45 PM New York – Stocks on Wall Street rebounded after investors shifted focus to domestic earnings. Google net rose but the search engine operator struggled to monetize mobile platform traffic. General Electric met earnings expectations and IBM sales declined.[/R]

Stocks recovered on Friday after geopolitical tension dragged market indexes in New York and Europe and investors shifted focus on earnings.

Google sales rose and earing growth slowed as the search operator struggled to monetize mobile platform ads. Also, quarterly earnings at the company inched closer to General Electric, large industrial and financial services conglomerate.

Tollbooth Index increased 0.5% or 48.68 to 9,497.67.

S&P 500 index increased 17.11 to 1,975.24 and the Nasdaq Composite Index soared 57.59 or 1.3% to 4,420.95.

Tensions remained high between Russia and European nations after rebels shot down a Malaysian Airlines passenger jet. United Nations Security Council is holding an emergency meeting to discuss the incident today.

U.S. also had shot down IranAir civilian flight in 1988, as the Iran-Iraq war was winding down, killing all 300 passengers and the U.S. was forced to pay $62 million to compensate victims after eight years of resisting, far less than the U.S. sought the compensation for the Lockerbie plane bombing in 1996.

U.S. Movers

General Electric Company ((GE)) slid 20 cents to $26.41 after the diversified technology and financial service provider reported total revenue in the second-quarter ending in June jumped 3% to $36.23 billion from a year earlier.

Net income in the quarter climbed 13% to $3.54 billion or 35 cents a diluted share compared to $3.13 billion or 30 cents from a year ago period.

Google Inc ((GOOGL)) jumped 2.9% or $16.62 to $597.27 after the search engine and related services provider reported revenue in the second-quarter ending in June soared 22% to $15.96 billion compared to a year earlier.

Net income in the quarter climbed 13% to $3.42 billion or $4.99 a diluted share compared to $3.23 billion or $4.77 from a year ago.

Google said sites revenues surged 69% to $10.94 billion and network segment revenue climbed 21% to $3.42 billion. Revenues from other business jumped 10% to $1.60 billion and revenue from the international segment totaled to $9.33 billion.

International Business Machines Corp ((IBM)) decreased 56 cents to $191.93 after the information technology provider reported total revenue in the second-quarter ending in June slid 2% to $24.4 billion in the same quarter of a year ago.

Net income in the quarter soared 28% to $4.14 billion or $4.12 a diluted share compared to $3.23 billion or $2.91 from a year ago.

European Markets

In London trading, FTSE 100 index inched lower 0.06% or 3.45 to 6,734.87 and in Frankfurt the DAX index fell 0.6% or 61.24 to 9,692.64.

In Paris, CAC 40 index slid 0.08% or 3.31 to 4,312.81.

Ireland based Shire Plc accepted £32 billion takeover offer from AbbVie.

And on the earnings front, Ericsson net surged 76% to 2.7 billion kronor and Electrolux net swung to loss of 92 million kronor. Volvo net climbed 21%.

France based luxury goods maker, Hermes Intl said revenue soared 8% to €1.9 billion primarily of sales increase in Asia. Sales in Asia now surpass European and American sales.

Asian Markets

Geopolitical tensions hovered market sentiment in Sydney trading and market indexes recovered from early doldrums to close higher. For the week, the indexes gained 0.7%.

International tensions ran high after Russia supported rebels shot down a passenger jet flying in international air space over Ukraine near Russian border. All 295 passengers including 15 flight crew were killed on a Malaysian Airlines flying from Amsterdam to Kuala Lumpur.

In addition, Israel stepped up its bombing offensive in Gaza and military widened its campaign to target rocket bases controlled by local groups defending borders.

The Nikkei 225 Stock Average dropped 154.55 or 1% to 15,215.71 and the broader Topix index slipped 10.09 to 1,263.29. For the week, Nikkei 225 gained 0.3%.

The yen closed at 101.35 against one U.S. dollar.

The Sensex Index gained 80.40 or 0.3% to close at 25,641.56 The CNX Nifty rose 23.45 to 7,663.90. For the week, Sensex climbed 2.5%.

On the earnings front in India, Bajaj Holdings net soared 18%, Greenply profit surged 34% and MindTree net climbed 31%. Zee net declined 6% but revenue jumped 8%.

Seamec won a five-year contract worth $15 million from ONGC. Wipro secured contracts of ten years from ATCO in Canada and Australia.