Stocks: Wednesday's review
Japanese stocks advanced the most in almost two weeks after U.S. housing starts increased and earnings beat estimates at companies including Johnson & Johnson, signaling the world’s biggest economy is recovering.
Fanuc Corp. (6954), Japan’s biggest maker of industrial robots, gained 2.3 percent. Toshiba Corp. (6502), Advantest Corp. (6857) and other makers of chips and related tools advanced after Intel Corp. (INTC) forecast sales that may top estimates. Inpex Corp. (1605), the nation’s largest oil explorer, soared 3.1 percent as crude prices rose.
European stocks rose the most in a month after results from Intel Corp. (INTC) to PSA Peugeot Citroen and L’Oreal SA (OR) spurred investor optimism in the economic recovery.
ASML Holding NV (ASML), Europe’s biggest chip-equipment maker, gained 5.3 percent as Intel posted first-quarter profit that beat forecasts and said it will generate $12.8 billion of revenue in the current period. Peugeot and L’Oreal rose at least 3 percent as sales beat the average analyst estimate at Europe’s second-biggest carmaker and the world’s largest cosmetics maker.
Peugeot, Europe’s second-biggest carmaker, climbed 4.7 percent to 28.45 euros as revenue in the first quarter of 15.4 billion euros ($22.4 billion) beat the average analyst estimate of 14.9 billion euros
Fiat SpA (F) jumped 4.6 percent to 6.58 euros as the owner of the Ferrari marque posted first-quarter earnings before interest, taxes and one-off items of 251 million euros. That beat the 241 million-euro average estimate of 14 analysts surveyed by Bloomberg.
L’Oreal gained 3.2 percent to 85.88 euros after the cosmetics maker reported first-quarter sales growth that beat analysts’ estimates as customers bought more Maybelline makeup and Ralph Lauren fragrances.
Bic SA surged 6.9 percent to 64.36 euros. The world’s biggest maker of disposable pens reported an increase in first- quarter net income to 53.9 million euros from 35.4 million euros a year earlier
U.S. stocks rallied, sending the Dow Jones Industrial Average to the highest level since June 2008, as sales at companies from Intel Corp. (INTC) to Yahoo! Inc. exceeded estimates and commodity producers gained.
Intel, the biggest chipmaker, climbed 6.6 percent after also forecasting revenue that may top projections. Yahoo! Inc., the most-visited U.S. Web portal, jumped 4.7 percent. United Technologies Corp. (UTX), the maker of Pratt & Whitney jet engines, rose 4 percent after increasing the lower end of its sales forecast. Alcoa Inc. (AA) and Chevron Corp. (CVX) added at least 1.6 percent as commodity prices advanced amid a weaker U.S. dollar.
Earnings-per-share beat analysts’ estimates at 78 percent of the 58 companies in the S&P 500 that reported results since April 11, data compiled by Bloomberg show. Companies in the index have topped estimates for eight straight quarters, the longest streak since at least 2006, helping propel the gauge up as much as 99 percent from the market bottom on March 9, 2009.
Stocks extended gains after sales of previously owned U.S. homes increased 3.7 percent to a 5.1 million annual rate in March, exceeding the 5 million median forecast of economists surveyed by Bloomberg News, data from the National Association of Realtors showed.
Companies most-tied to economic growth, including technology, energy producers and consumer discretionary shares, led the gains in the S&P 500 within 10 groups. The Morgan Stanley Cyclical Index rallied 1.6 percent as 28 of its 30 stocks advanced.