Stocks: Thursday's review
Japanese stocks fell for a second day, led by Tokyo Electric Power Co., after the utility cast doubt on a planned dividend and as carmakers declined on concern parts supplies will be disrupted.
Tokyo Electric, which operates the nuclear plant damaged by a March 11 earthquake and tsunami, tumbled 14 percent as it suspended its decision to pay a second-half dividend.
Other utility companies also declined. Tohoku Electric Power Co., which provides electricity to disaster-stricken areas including Fukushima, Iwate and Miyagi prefectures, sank 5 percent to 1,514 yen. Chubu Electric Power Co. slumped 1.7 percent to 1,976 yen after the company delayed the planned start on construction of a new reactor for a year. Nissan Motor Co., Japan’s third-largest carmaker by sales, lost 4.6 percent after the company said about 40 component suppliers remain in difficulty following the record quake.
European stocks advanced as carmakers and retailers rallied and Portugal’s Prime Minister Jose Socrates resigned, bringing the country closer to getting a bailout from the European Union.
Bayerische Motoren Werke AG (BMW) and Daimler AG (DAI) rose more than 3 percent. Next Plc (NXT) jumped 4 percent as revenue increased. Hugo Boss AG climbed 1.7 percent as BofA Merrill Lynch Global Research recommended buying the shares. BHP Billiton Ltd. and Rio Tinto Group led basic-resource shares higher as the mining companies won a battle over tax credits in Australia.
U.S. stocks rose, sending the Standard & Poor’s 500 Index higher for a second day, after corporate profit topped analysts’ estimates and a government report showed a decline in jobless claims.
Micron Technology Inc. (MU), the biggest U.S. producer of computer-memory chips, rose 7.8 percent and Linux-software maker Red Hat Inc. (RHT) surged 20 percent after earnings beat analysts’ estimates. GameStop Corp. (GME) jumped 3.3 percent as the largest video-game retailer forecast profit above analyst’s projections. Amazon.com Inc. (AMZN) gained 3.6 percent after William Blair & Co. raised its rating for the world’s biggest online retailer.
The S&P 500 rose 0.8 percent to 1,308.3 at 2:22 p.m. in New York, the highest on a closing basis in two weeks. The Dow Jones Industrial Average advanced 80.08 points, or 0.7 percent, to 12,166.10. The Chicago Board Options Exchange Volatility Index, which measures the cost of using options as insurance against declines in the S&P 500, slumped 5.6 percent to 18.09.
U.S. stocks rose yesterday, erasing most of the previous day’s drop, as higher metal prices lifted commodity producers. The S&P 500 has gained 3.2 percent in 2011 through yesterday, extending last year’s 13 percent rally, amid government stimulus measures and as companies reported earnings that topped analysts’ estimates for the eighth straight quarter.