Earnings Provide Support to Wall Street Indexes, New Home Sales Rise 0.2%

Nichole Harper
24 Oct, 2014
New York City

Wall Street indexes meandered after new home sales rose 0.2% in September. Earnings dominated market sentiment and Microsoft surged after reporting better than expected revenues. Amazon Inc plunged after reporting wider than expected loss. European Markets stepped back ahead of stress test results.

[R]11:50 AM New York – Stocks on Wall Street meandered after new home sales barely grew in September. Earnings dominated market sentiment and Microsoft surged after reporting better than expected revenues. Amazon Inc plunged after reporting wider than expected loss. European Markets step back ahead of bank stress test results.[/R]

Stocks on Wall Street lacked direction after a strong opening on the back of flood of earnings from Amazon.com, Microsoft, Proctor & Gamble and UPS.

S&P 500 index increased 2.45 or 0.1% to 1,953.33 and the Nasdaq Composite Index added 0.2% or 9.63 to 4,462.82.

U.S. New Home Sales

September month new homes sales increased 0.2% to a 467,000 annual rate from the lowered 466,000 pace in August, the Commerce Department reported today in Washington.

The August sales were sharply revised lower 7.5% from the previous estimate of 504,000 units.

The latest housing data confirms the uneven and slow recovery in the sector after housing market stalled in the second half of 2013 as mortgage rates jumped.

Home sales in the West declined 8.9%, following a surge of 28.1% in August and sales in the Northeast were flat. In the South, sales rose only 2% and soared 12.3% in the Midwest.

U.S. Movers

Amazon.com, Inc ((AMZN)) plunged 7.4% or $23.08 to $290.10 after the company reported larger than quarterly loss on the account of weaker than expected sales of its Fire phone.

Microsoft Corp ((MSFT)) increased 1.7% or 69 cents to $45.71 after the software developer and reported better-than-expected quarterly revenues.

Pandora Media Inc ((P)) plunged 14.3% or $3.31 to $19.84 after the online radio station services operator reported larger than estimated loss by analysts.

Proctor & Gamble Co ((PG)) advanced 3% or $2.53 to $85.74 and the consumer products maker reported in-line fiscal first quarter net and the company said it plans to exit its Duracell battery business.

RealPage, Inc ((RP)) soared 14% or $2.30 to $18.42 after the on demand software services provider for rental properties after the company received merger overtures from at least two private equity groups according to a report in Financial Times.

United Parcel Service, Inc ((UPS)) added 0.9% or 88 cents to $101.40 after the package delivery services provider reported earnings that were ahead of analysts’ estimates.

European Markets

European markets traded lower ahead of bank stress report scheduled to be released this Sunday.

European Central Bank is scheduled to take over as the euro zone’s bank supervisor.

The draft summary of the report released by the central bank today showed that 25 banks failed the stress test parameters set by the bank.

In London trading, FTSE 100 index decreased 0.5% or 31.60 to 6,387 and in Frankfurt trading, the DAX 30 index dropped 0.6% or 53.75 to 8,993.11.

CAC 40 index in Paris declined 0.6% or 26.43 to 4,131.25.

Asian Markets

Indexes in Tokyo soared and the Nikkei 225 index increased 1.1% to 15,291.64 an the yen gained 0.3% to 107.95.

In the week, the Nikkei and Topix added more than 5%, the largest weekly gain since April 2013. The market indexes in Tokyo dropped 12% in the previous three weeks.

In Hong Kong Hang Seng Index decreased 0.1% or 30.98 to 23,302.20 and for the week added 1.2%.

In Mumbai markets were closed to mark the celebration of Hindu New Year 2071.

In Sydney trading, ASX 200 index gained 29.10 to close at 5,412.20 and All Ordinaries index advanced 0.5% to 5,399.30. For the week, both indexes soared 2.7%.

In stock trading, turnover increased to 751 million shares worth $4.05 billion and Australian dollar closed at 87.67 U.S. cents.

In commodities trading, gold eased and extended weekly loss by $8.77 to US$1,230 an ounce.

Light crude oil increased $1.57 to US$82.09 a barrel.