Intel earnings give world markets a boost as attention turns to US results, retail salesBy Pan Pylas, AP
Wednesday, April 14, 2010
Intel earnings give world markets a boost
LONDON — World markets mostly rose Wednesday after better-than-expected first quarter earnings from Intel Corp. stoked hopes about the global economic recovery.
In Europe, the FTSE 100 index of leading British shares was up 29.95 points, or 0.5 percent, at 5,791.61 while Germany’s DAX rose 31.04 points, or 0.5 percent, to 6,261.87. The CAC-40 in France was 21.84 points, or 0.5 percent, higher at 4,053.83.
Wall Street was also poised to open higher following four straight days of gains, after Intel’s after-hours statement Tuesday showing that it earned $2.4 billion, or 43 cents per share, in the first three months of 2009 — the consensus in the markets was that the company would earn 38 cents a share.
Dow futures were up 22 points, or 0.2 percent, at 10,985 while the broader Standard & Poor’s 500 futures were 2.6 points, or 0.2 percent, at 1,195.70.
“Investors are taking the sign of strong sales at Intel as reassurance that the economic recovery is well underpinned by business expansion and a healthy consumer appetite,” said Anthony Grech, market strategist at IG Index.
With concerns about Greece’s debt situation reduced following the weekend agreement by the eurozone to provide the country with money, if needed, attention will likely remain on upcoming U.S. earnings.
JP Morgan Chase kicks off the banks’ earnings reporting season later — the focus will be on how many more bad debts the bank writes down in relation to the U.S. housing markets and how confident the bank is about the future.
There will also be a lot of interest in U.S. retail sales data for March following strong updates from a number of retailers last week — the consensus in the markets is that sales grew by a monthly 1.2 percent, way up on the 0.3 percent recorded in February, largely because winter abated.
The state of household spending in the U.S. is key for the global economic recovery — U.S. consumer spending accounts for around 70 per cent of the nation’s economy.
“The positive trend to the U.S. economy is pretty clear,” said Kit Juckes, chief economist at ECU Group.
Later on in the day, the U.S. Federal Reserve publishes its so-called Beige Book, an assessment of economic conditions across the regions of the U.S.
“I will fall off my chair in amazement if it doesn’t maintain the dovish tone we have been hearing repeatedly from the Fed,” said Juckes.
Earlier in Asia, Singapore’s main stock index led gainers, advancing 1.6 percent after the government said the economy grew an annualized 32 percent in the first quarter.
South Korea’s index jumped 1.5 percent, Australia climbed 0.9 percent, Japan rose 0.4 percent, Malaysia added 0.2, while Indonesia and Hong Kong were little changed.
China’s benchmark stock index gained 0.2 percent ahead of Thursday’s first estimate of Chinese economic growth in the first three months of the year.
Markets were closed in India and Thailand for holidays.
In the foreign exchange markets, the euro rose 0.2 percent at $1.3647, helped partly by another solid increase in industrial production in the 16 countries that use the currency.
Eurostat, the EU’s statistics office, said that industrial production in the eurozone rose by 0.9 percent in February from the month before, way higher than the 0.1 percent increase anticipated in the markets.
It’s also the second sizable monthly rise following January’s 1.6 percent increase, and reinforced hopes that the recovery from recession is proving to be more robust than anticipated.
Benchmark crude for May delivery was up 68 cents to $84.73 a barrel.
Associated Press Writer Alex Kennedy in Singapore contributed to this report.
Tags: Asia, Chase, East Asia, Europe, London, North America, Retail And Wholesale Sector Performance, Southeast Asia, United Kingdom, United States, Western Europe, World-markets