World stocks run win streak to nine days as earnings heat up
NEW YORK (Reuters) – A gauge of global stocks climbed for a ninth straight session on Wednesday after a slew of corporate earnings reports in the United States and Europe, while the dollar bounced moderately off of 10-month lows.
The S&P 500 and Nasdaq hit intraday record highs, picking up from strong performances by major European stock indexes.
After decent gains in Asia on the back of positive signs from global economic powerhouse China, MSCI’s world stocks index looked set for a ninth day of gains, which would mark its longest winning streak since October 2015. The global index gained 0.33%, setting a record high for a fifth-straight session.
“In the US, the earnings season seems to be surprising a little bit on the upside,” said Bruce McCain, chief investment strategist at Key Private Bank in Cleveland. “What we have seen recently in the economic reports suggests it should be even better overseas... So we have come to the point where things looks pretty good in the US, and it looks even better in prospect overseas, so what’s not to like about equities.”
In early afternoon trading, the Dow Jones Industrial Average rose 25.24 points, or 0.12%, to 21,599.97, the S&P 500 gained 6.44 points, or 0.26%, to 2,467.05, and the Nasdaq Composite added 28.45 points, or 0.45%, to 6,372.76.
Morgan Stanley shares climbed 2.4% after the bank’s profit report.
Biotech Vertex soared 22.2% after stunning cystic-fibrosis drug data.
Not all was rosy in earnings season, as IBM shares dropped 3.8% after its report.
About a week into the heart of second-quarter reporting season, S&P 500 earnings are now expected to rise 8.7%, up from an expectation of an 8% rise from the start of July, according to Thomson Reuters I/B/E/S.
In Europe, the pan-European FTSEurofirst 300 index rose 0.67%. Dutch semiconductor equipment maker ASML’s shares gained 6.2% after the firm’s quarterly report, boosting the region’s tech sector.
“We would like to see those stronger earnings coming through and Europe really turning a corner,” said Dafydd Davies, a partner at Charles Hanover Investments.
The dollar edged higher against a basket of currencies a day after the greenback’s sharp decline sparked by a fresh setback to President Donald Trump’s domestic agenda.
The dollar index rose 0.13%, with the euro down 0.24% to $1.1524.
Investors remained wary of pushing the US currency lower before meetings this week with the European Central Bank and the Bank of Japan. Market watchers will be looking to see if the recent strength of the euro and the yen influence their policy outlooks.
US Treasury yields were little changed on light trading volume, with benchmark yields hitting their lowest levels in nearly three weeks in advance of Thursday’s ECB meeting.
Benchmark 10-year notes last fell 1/32 in price to yield 2.2642%, from 2.263% late on Tuesday.
Oil prices jumped, extending gains after a US government report showed a bigger weekly draw than forecast in crude and gasoline stocks along with a surprise drop in distillate inventories.
US crude rose 1.31% to $47.01 per barrel, and Brent was last at $49.50, up 1.35% on the day.