NEW YORK: The S&P 500 index climbed to a new high at the start of trading yesterday and was on track for its best weekly gain in more than three months, boosted by earnings from big companies like Google and Morgan Stanley.
Among top gainers was Google Inc, which surged to a record of $1,000 a share, a day after delivering better-than-expected results. The company is the second in the S&P 500 to trade at this level, following on the heels of Priceline.com, which was trading at $1,052, up nearly 2 percent.
Morgan Stanley shares rose 2.7 percent to $29.72 after the company reported a 50 percent rise in quarterly revenue as higher income from equities sales and trading offset a drop in its fixed-income business. General Electric Co shares rose 2.7 percent to $25.33 following results, and was the biggest boost to the blue chip Dow index, although declines in Home Depot and Microsoft kept the Dow gains in check.
European shares rose to a five-year high after robust growth data from China boosted luxury goods and mining stocks, while good results from Accor helped raise the travel and leisure sector.
The Chinese economy grew 7.8 percent year-on-year in the third quarter as forecast by analysts, although authorities warned of slowing momentum in the fourth quarter.“The focus is off problems in Washington for now, and refocused on earnings, and when a company like Google surprises, it’s a huge plus.”
The personal and household goods sector - which includes luxury goods firms such as Burberry and LVMH , both under pressure recently after warning of slowing sales in China - was a top gainer, up 1.9 percent.
The Dow Jones industrial average was up 0.13 points, or 0.00 percent, at 15,371.78. The Standard & Poor’s 500 Index was up 6.41 points, or 0.37 percent, at 1,739.56. The Nasdaq Composite Index was up 28.85 points, or 0.75 percent, at 3,891.99. The S&P 500 climbed to a fresh high yesterday, adding to its previous record on Thursday, which was spurred by mounting investor confidence in the wake of a last-minute deal by US lawmakers to avoid a debt default.
So far, 85 companies representing 25.8 percent of S&P 500’s market capitalisation have reported, with earnings beating estimates by an average of 4.2 percent, according to RBC Capital Markets.
Also boosting market sentiment, data showed third-quarter growth in China, the world’s second-biggest economy, grew 7.8 percent from a year ago, its quickest pace for the year, thanks largely to investment.
A number of Federal Reserve officials are due to speak throughout the day, including US Federal Reserve Governor Daniel Tarullo and New York Fed President William Dudley at a Fed conference on resolution of systematically important banks in Washington.Reuters