Stocks: Wednesday's review
Japanese stocks rose the most in three weeks after Greek Prime Minister George Papandreou won a parliamentary confidence vote that moved the country one step further from default.
Sony Corp. (6758), which gets more than 20 percent of its sales in Europe, climbed 3.7 percent.
Toyota Motor Corp. (7203) gained 1.1 percent after Deutsche Bank AG. raised its profit estimate for the world’s biggest carmaker.
Jtekt Corp. (6473), a supplier of parts to Toyota, advanced 3.2 percent to 1,189 yen. The company, which had delayed earnings forecasts because of damage from March’s earthquake, said net income will rise 20 percent to 24 billion yen in the year ending in March 2012.
Oji Paper Co. jumped 3.5 percent after Daiwa Securities Capital Markets Co. raised its rating on Japan’s largest papermaker to “outperform,” citing improving profits at the company’s cardboard business.
European stocks closed lower on Wednesday after Dutch electronics manufacturer Philips issued a profit warning.
Philips lost 8.8 per cent to €16.41 after it warned of a “low single-digit” sales decline in the second quarter at its consumer lifestyle division. The company said it would announce cost cuts in the coming weeks.
Swedish rival Electrolux fell 3.4 per cent to SKr147.80 in response. This came in spite of news that the finance chief of its Egyptian takeover target Olympic expected the deal to be completed within a month.
On the upside, Renault, the French carmaker, gained 2.9 per cent to €39.17 after chief executive Carlos Ghosn said the company’s Japanese partner Nissan would forecast “significantly higher” sales for 2011. He said production had been restored more quickly than expected after the March earthquake.
Tele2, the Nordic telecoms operator, which has operations in Russia and other emerging markets, rose 1.5 per cent to SKr120.90 after its rating at broker SEB was raised to “buy” from “hold”.
Finnish paper manufacturer UPM-Kymmene rose 2.8 per cent to €12.57 after Credit Suisse raised its rating to “outperform” from “neutral”.
U.S. stocks fell Wednesday after the Federal Reserve issued a dour assessment of the economy but gave no indication that additional stimulus measures are in the works.
Shares of Boeing (BA, Fortune 500) fell 2.5%, making it the worst performer on the Dow. But the selling was broad based, with only three stocks in the blue-chip index ending in the black.
In a widely expected move, the Fed held its benchmark interest rate near zero percent, saying the economic recovery has been weaker than expected.
The central bank also repeated that its $600 billion stimulus program will end next week, as scheduled. It will continue to use interest earned on its $2.6 trillion portfolio of securities to buy long-term Treasuries.
Companies: FedEx (FDX, Fortune 500) reported earnings and sales that topped forecasts, and hiked its outlook. That sent shares of the shipping company up 3%. Shares of rival UPS (UPS, Fortune 500) edged up nearly 1%.
Shares of Adobe Systems (ADBE) slumped more than 6%. The software maker posted a 54% jump in second-quarter profit after the market close Tuesday, but issued a revenue outlook that fell short of expectations.
Carmax (KMX, Fortune 500) reported first-quarter earnings that widely beat expectations, sending shares of the company 7.5% higher.