On 25 April, 2017 – Stocks continued their rally for a second day

Markets were buoyed by French election results and some positive earnings reports.
United States
Stocks were higher Tuesday, adding to the strong gains posted in the previous session. With the continued increases, Nasdaq climbed to a new record closing high over the 6,000 level for the first time. Both the Nasdaq and S&P added 0.7 percent for the day while the Dow Jones industrials were up 1.2 percent. Upbeat earnings from DuPont, Caterpillar and McDonald’s generated buying interest.
DuPont reported first quarter results that beat estimates on both the top and bottom lines. Caterpillar also moved higher after reporting better than expected first quarter results and raising its full-year guidance. McDonald’s also reported first quarter earnings and revenues that exceeded estimates. The company also reported an unexpected increase in comparable sales. Coca-Cola reported first quarter earnings that came in below estimates but revenues were better than expected. Epizyme, Albany Molecular Research and Affimed advanced. Apple, Facebook, Google and Amazon also continued to climb. Tyson Foods is buying AdvancePierre Foods for $4.2 billion including debt. Tyson is offering $40.25 cash per each AdvancePierre share giving the company an equity value of about $3.2 billion. Tyson will also assume about $1.1 billion of AdvancePierre’s debt.
March new home sales jumped 5.8 percent to an annualized rate of 621,000 from a revised 587,000 in February. April Conference Board consumer confidence index slid to 120.3 from a revised 124.9 in March.
These data reflect observations at 4:00 PM US ET. Gold at the afternoon London fixing was down US$1.60 to US$1,267.80. Copper futures were up 1.35 percent to US$2.60. WTI spot crude was up 54 US cents to US$49.77. Dated Brent spot crude was up 74 US cents to US$52.34. The US dollar was up against the yen and the Canadian and Australian dollars. The currency declined against the euro, pound and Swiss franc. The Dollar Index was down 0.2 percent. The yield on the US Treasury 30 year bond was up 7 basis points to 2.99 percent and the 10 year note was up 6 basis points to 2.33 percent.
Europe
European stock markets advanced with modest gains Tuesday. Investors shifted their focus to corporate earnings results and a deal between France’s LVMH and Christian Dior from the French election results. Both the FTSE and CAC were up 0.2 percent, the DAX edged up 0.1 percent and the SMI added 0.7 percent.
Investor sentiment remained positive following Emmanuel Macron’s victory in the first round of the French presidential election Sunday. Macron is expected to defeat Marine Le Pen in the runoff election, which has eased concerns over the possibility of France leaving the European Union and has increased the risk appetite among investors.
SAP advanced after it reported a 9 percent fall in first quarter profit but said sales of its Internet cloud-based offerings were picking up momentum. Aixtron jumped after the semiconductor firm narrowed its first-quarter net loss. Puma gained after it set a new quarterly record for sales between January and March. Continental AG declined. According to Bloomberg, the automotive components supplier held talks with Delphi Automotive earlier this year about merging parts of their powertrain divisions. LVMH and Christian Dior were higher after LVMH announced it would buy out the minority interest held by Christian Dior SA in a €12.1 billion deal.
Essilor gained after confirming its fiscal 2017 targets. Hikma and Shire rose after German healthcare firm Fresenius announced two acquisitions worth more than $5 billion combined. Whitbread retreated after it warned of a ‘tougher consumer environment’ going forward as a result of the UK leaving the EU. BHP Billiton and Anglo American were lower. Volvo surged 7.62 percent in Stockholm after its first-quarter net profit beat forecasts. Ericsson was lower after posting a wider-than-expected operating loss in the first quarter. Novartis increased in Zurich even though the company reported a drop in first-quarter earnings, mainly due to a net charge related to the discontinuation of an acute heart failure drug.
Asia Pacific
Stocks advanced Tuesday as European political risks faded and oil prices rebounded after six consecutive days of losses. Investors kept a wary eye on North Korea as the country celebrates the 85th anniversary of the Korean People’s Army, amid signs Pyongyang could soon conduct another nuclear test in defiance of United Nations sanctions. Offsetting these worries was the easing fears of a risk of a French exit from the Eurozone. Australian markets were closed for a public holiday.
The Shanghai Composite edged up 0.2 percent after Monday’s steep loss — investors are concerned about the regulatory crackdown on shadow banking. The Hang Seng jumped 1.3 percent.
Both the Nikkei and Topix added 1.1 percent as the yen weakened Exporters Canon, Panasonic, Toshiba and Toyota climbed along with banks Mitsubishi UFJ Financial, Sumitomo Mitsui Financial and Mizuho Financial Group. Japan Post Holdings advanced on a Nikkei report that the company is redrawing its overseas strategy. NEC rallied after lifting its operating profit forecast.
The Kospi added 1.1 percent to hit their highest level in nearly six years as survey data from Bank of Korea showed April’s consumer confidence rose by the most since 2013 helped by a rise in exports and public expectations for new economic policies. The Sensex was 1.0 percent higher.
Looking Forward
Australia posts first quarter consumer price index. Canada reports February retail sales. In the US, the weekly EIA petroleum status report will be released.
Global Stock Markets

*Note — all releases are listed in local time.

Source: Fidelity

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