Markets get earnings cheer ahead of Apple report
AP October 26, 2012, 12:03 am TWN
LONDON--A run of encouraging earnings statements in Europe ahead of a report from Apple shored up sentiment in financial markets Thursday, contributing to solid gains for stocks.
Though European trading updates were not uniformly positive, the tone in markets improved through the day. German industrial conglomerate BASF, consumer products company Unilever and Swiss bank Credit Suisse all enjoyed strong share price gains after their reports.
"In light of a positive response to earnings news across Europe, regional markets are seeing gains and again this should help cheer sentiment on the other side of the Atlantic," said Fawad Razaqzada, market strategist at GFT Markets.
In Europe, Germany's DAX was up 0.5 percent at 7,231 while the CAC-40 in France rose 0.5 percent to 3,444. The FTSE 100 index of leading British shares was 0.3 percent higher. UK stocks did not register much of a gain from figures showing the British economy grew by a greater than expected 1 percent in the third quarter thanks partly to spending on the London Olympics.
U.S. stocks are poised for a solid opening, with Dow futures up 0.4 percent and the broader S&P 500 futures 0.5 percent higher.
Looking ahead, investors will monitor another batch of U.S. earnings from the likes of oil company ConocoPhillips, consumer goods maker Procter & Gamble and Dow Chemical.
Results are also due from Amazon and Apple — the latter being the world's largest company by market capitalization. Both of their reports will be released after the markets close, however, meaning their market impact will be felt on Friday.
The quarterly earnings reports have so far been unspectacular, especially from the technology sector, knocking sentiment in markets. On Tuesday, stocks suffered one of their worst days in weeks.
Despite the steadier tone over the past couple of days, concerns about the global economy remain, and could linger until the result of the U.S. presidential election is clear. Americans go to the polls in less than two weeks.
"With the U.S. markets now awaiting the outcome of an increasingly tight election race whilst European markets endure the political brinkmanship embracing the eurozone, the remaining confidence is slowly being sapped from investors," said Mike McCudden, head of derivatives at Interactive Investor.
Earlier, sentiment in markets had been buoyed by another improving Chinese manufacturing survey, which eased concerns that the world's second-largest economy was heading for a hard economic landing after years of big growth.
Asian stock markets finished mostly higher. Japan's Nikkei 225 index rose 1.1 percent to close at 9,055.20 — a one-month high. A weakening yen helped to boost export shares.
South Korea's Kospi rose 0.6 percent to 1,924.50 but mainland Chinese shares failed to capitalize on the manufacturing news. The Shanghai Composite shed 0.7 percent to 2,101.58 while the Shenzhen Composite Index lost 1 percent to 858.04.
MOST POPULAR OF THIS SECTION