While you were sleeping Jobless claims, HP surprise

Thursday 28th November 2013

Wall Street advanced amid better-than-expected US jobs data and earnings including from Hewlett-Packard, bolstering optimism about the outlook for the world's largest economy and corporate profits.

Shares of Hewlett-Packard jumped, last up 7.7 percent, after the company posted better-than-expected quarterly earnings showing CEO Meg Whitman's efforts to revamp it are paying off.

"Through improved execution, strong cost management, and with the support of our customers and partners, HP ended fiscal 2013 on a high note," Whitman said in a statement. "Our Q4 results demonstrate that HP's turnaround remains on track heading into fiscal 2014."

There was more good news on the US labour front. Initial claims for state jobless benefits unexpectedly fell, declining 10,000 to a seasonally adjusted 316,000, according to Labor Department data.

"We are at a level that, if sustained, would point to solid job gains ahead," Joel Naroff, chief economist at Naroff Economic Advisors in Holland, Pennsylvania, told Reuters.

Separately, the Thomson Reuters/University of Michigan's final reading on the overall index on consumer sentiment unexpectedly rose, increasing to 75.1 in November, up from 73.2 in October, while the Conference Board's index of US leading indicators climbed 0.2 percent in October, rising for a fourth consecutive month.

The gain supports the Conference Board's forecast that US economic growth is poised to accelerate to 2.3 percent in 2014, compared to 1.6 percent in 2013, Kathy Bostjancic, director of macroeconomic analysis at the Conference Board, said in a statement.

"Within the details, the sub-indexes contributing positively to growth are the financial, housing and manufacturing variables," Bostjancic said. "Restraining growth is the ongoing caution of businesses that continue to keep tight reins on capital expenditures."

To be sure, another report showed orders for US durable goods slid 2 percent in October.

In afternoon trading in New York, the Dow Jones Industrial Average rose 0.11 percent, the Standard & Poor's 500 Index gained 0.18 percent, and the Nasdaq Composite Index increased 0.48 percent.

Shares of IBM climbed, last up 1.4 percent, and leading gains in the Dow.

Trading volume on Wall Street was thin as many traders left work early ahead of Thursday's Thanksgiving holiday. Wall Street will be closed on Thursday and open just a half day on Friday.

In Europe, the Stoxx 600 Index advanced 0.6 percent from the previous close. The UK's FTSE 100 Index added 0.2 percent, while France's CAC 40 gained 0.4 percent.

Germany's DAX rose 0.7 percent to close at a record high amid signs of stronger-than-expected consumer confidence in the engine economy of the euro zone. The DAX has gained 23 percent so far in 2013.

"The consumer-confidence data show Germany is on the road to prosperity," Jacques Porta, who helps oversee about US$780 million as a fund manager at Ofi Gestion Privee in Paris, told Bloomberg News. "The stocks rally in Germany this year is merited, its economy is competitive and efficient. The coalition agreement is good news, and it will continue Germany's political stance in European policies."

Following a vote in Italy's Senate, Silvio Berlusconi was expelled from the country's parliament because of the billionaire's conviction for tax fraud.

BusinessDesk.co.nz

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