Don’t miss the latest developments in business and finance.

Facebook lifts U.S. stocks as dollar, global shares fall

Image
Reuters NEW YORK
Last Updated : Jul 26 2013 | 2:50 AM IST

By Herbert Lash

NEW YORK (Reuters) - The dollar and global equity markets fell on Thursday after mixed corporate earnings and renewed worries about growth in China weighed on investor sentiment, but a 30 percent jump in Facebook Inc shares lifted U.S. stocks from the doldrums.

Facebook posted its biggest single-day percentage gain ever a day after the world's No. 1 social network reported a better-than-expected surge in mobile advertising.

Facebook was the most actively traded Nasdaq-listed share, surpassing the second-most active by 4 to 1, in volume that was the heaviest since its marred IPO more than a year ago.

The late-day U.S. stock rally came as global equity markets fell after profit warnings in Europe by German heavyweights BASF and Siemens. Corporate America's earnings for the most part have failed to impress, even as General Motors and Dow Chemical Co posted strong results.

"The market is anticipating a pick-up in corporate profits, looking to later parts of this year, but we're not seeing robust earnings in the here and now," said Kevin Caron, market strategist at Stifel, Nicolaus & Co in Florham Park, New Jersey.

More From This Section

Of the 233 companies in the S&P 500 that have posted results through early Thursday, 67.8 percent beat analyst expectations, slightly better than the past four quarters and above the 63 percent average since 1994, Thomson Reuters I/B/E/S said.

The Dow Jones industrial average closed up 13.37 points, or 0.09 percent, to end at 15,555.61. The Standard & Poor's 500 Index rose 4.31 points, or 0.26 percent, to finish at 1,690.25. The Nasdaq Composite Index gained 25.59 points, or 0.71 percent, to close at 3,605.19.

Global shares as measured by MSCI's all-country world index fell 0.1 percent, while the FTSEurofirst 300 index of top European shares closed down 0.45 percent at 1,209.11.

Major indexes in Britain, France and Germany also closed lower.

In London, mining shares were big losers, led by Anglo American and Rio Tinto , as mounting worries about China halted a recovery rally in the sector.

The dollar fell against the euro and the yen as investors saw positive economic news in Europe, but a rise in U.S. business spending plans for a third straight month in June was not enough to drive the U.S. currency.

German government bonds fell as better data from major European economies this week prompted investors to dump safe-haven assets.

German business morale rose for a third straight month in July, Spain's unemployment rate fell for the first time in two years and UK growth sped up in the second quarter.

German 10-year yields were up 3.2 basis points at 1.67 percent, while German Bund futures settled down 44 ticks at 142.28 after Wednesday's more than full-point drop.

The benchmark 10-year U.S. Treasury note was up 1/32 to yield 2.579 percent.

The euro was near a one-month peak in New York trading after the German Ifo survey. The influential think tank's business climate index rose to 106.2 in July from 105.9 a month ago, just ahead of forecasts of a 106.1 reading.

The dollar index fell 0.7 percent to 81.683, while the euro rose to $1.3295, the highest since June 20, and was last at $1.3291, up 0.7 percent.

The dollar fell 1.2 percent against the yen to 99.04 yen.

Crude edged higher in choppy trade after initially falling on concerns over weak Chinese economic data dimming the outlook for demand in the world's No. 2 oil consumer. U.S. crude output reached the highest rate in more than two decades.

Brent crude oil rebounded, rising 46 cents to settle at $107.65 a barrel.

U.S. crude futures rose 10 cents to settle at $105.49 a barrel.

USEFUL LINKS:

U.S. natural gas stocks: https://bsmedia.business-standard.comlink.reuters.com/mup44s

U.S. durable goods: http://link.reuters.com/huq55t

U.S. jobless claims: http://link.reuters.com/xew34t

General Motors earnings: http://link.reuters.com/faq89t

(Additional reporting by Richard Hubbard in London; Editing by James Dalgleish and Dan Grebler)

Also Read

First Published: Jul 26 2013 | 2:35 AM IST

Next Story