Thursday 9th May 2013 |
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Wall Street hit new records amid solid earnings from corporate America including Whole Foods, while China posted better-than-expected trade data and Germany showed an unexpected increase in industrial production.
Shares of grocery-store chain Whole Foods jumped, last up 9.9 percent, after the company raised its full-year forecast. Shares of retailer JC Penney also gained, last 6.7 percent higher, as the department-store retailer's preliminary fiscal first-quarter sales were better than expected.
"This is the first time the news hasn't been horrific," Liz Dunn, an analyst at Macquarie Group in New York, told Bloomberg News, referring JC Penney results. "The numbers aren't that bad."
In afternoon trading in New York, the Dow Jones Industrial Average rose 0.3 percent, the Standard & Poor's 500 Index increased 0.3 percent, while the Nasdaq Composite Index gained 0.4 percent. The S&P 500 climbed to a record 1,631.24 earlier in the session, while the Dow reached a high of 15,082.47.
Scott Black, president of Boston-based Delphi Management, said he expects the S&P 500 will extend its record rally, underpinned by the US Federal Reserve's stimulus measures.
"There's room to go on the upside, especially since you're getting nothing on the fixed-income side," Black told Bloomberg. "There's every indication that Ben Bernanke is going to remain accommodative because we're not even near the threshold where he wants to get unemployment back under 6.5 percent."
Shares in Delta Airlines were 2.7 percent higher after the carrier said it plans to return US$1 billion to shareholders by buying back its own shares and restarting a dividend that it halted a decade ago.
In Europe, stocks were buoyed by better-than-expected data from the region's largest economy, providing fresh signals of a recovery. German industrial production rose 1.2 percent in March, surprising economists who had predicted a decline of 0.1 percent.
The benchmark Stoxx 600 Index advanced 0.6 percent, while Germany's DAX added 0.8 percent. The UK's FTSE 100 gained 0.4 percent, while France's CAC 40 climbed 0.9 percent.
"It looks as if the outlook for German industry is clearing slowly but surely," ING senior economist Carsten Brzeski told Reuters. "There's a lot of contradictory signs ... but industrial production looks OK-we will get out of the contraction of the fourth quarter and though we're not accelerating as much as in 2010, we won't have a recession."
In China, exports jumped 14.7 percent in April, while imports rose 16.8 percent, both exceeding expectations and bolstering hope that the world's second-largest economy is stronger than previously thought.
BusinessDesk.co.nz
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