On 19 July, 2017 – Stocks advanced globally thanks to positive earnings reports

Investors were focused on the upcoming ECB and BoJ policy decisions.
United States
US share indices rallied with the Nasdaq and the S&P closing at record highs. The Nasdaq was up 0.6 percent propelled by Vertex and the S&P added 0.5 percent. The Dow Jones industrials, weighed down by IBM, were up 0.3 percent. A report on housing starts showing a bigger than anticipated rebound that stirred investors along with some positive earnings reports.
June housing starts surged a monthly 8.3 percent to an annualized rate of 1.215 million, up from 1.122 million in May. Building permits also jumped, up a monthly 7.4 percent to an annualized rate of 1.254 milliony.
Vertex jumped to an all-time high a day after it reported positive results for its cystic fibrosis treatment. IBM declined after its quarterly revenue was below expectations. Microsoft and Facebook boosted both the S&P and the Nasdaq. They are due to report results this week and next. Netflix’s stellar results had propelled the Nasdaq to close at a record high on Tuesday, helping the index post its longest streak of gains since February 2015.
Morgan Stanley advanced after it posted better than expected profit and bond trading revenue declines that were modest compared with Goldman Sachs. Goldman declined. Morgan Stanley said its second-quarter profit rose to $1.76 billion. The investment bank reported earnings of 87 cents per share. Revenue of $9.5 billion was up from $8.91 billion in the second quarter of last year. CSX declined after the railroad operator’s forecast missed expectations. Other railroad companies such as Union Pacific and Kansas City Southern declined.
These data reflect observations at 4:00 PM US ET. Gold at the afternoon London fixing was down US$5.30 to US$1,236.80. Copper futures were down 0.8 percent to US$2.71. WTI spot crude was up 70 US cents to US$47.10. Dated Brent spot crude was up 84 US cents to US$49.68. The US dollar was up against the euro, pound and Swiss franc. The currency declined against the yen and the Canadian and Australian dollars. The Dollar Index was up 0.1 percent. The yield on US Treasury 30 year bond was unchanged at 2.85 percent while the yield on the 10 year note edged up 1 basis point to 2.27 percent.
Europe
Stocks rebounded from Tuesday’s losses and advanced Wednesday. Traders were encouraged by some better than expected corporate earnings reports but were cautious ahead of tomorrow’s announcements from the Bank of Japan and the European Central Bank. Both are widely expected to leave their respective monetary policies unchanged. The FTSE was up 0.6 percent, the CAC added 0.8 percent, the DAX edged up 0.2 percent and the SMI was 0.5 percent higher.
Commerzbank and Deutsche Bank both were lower after the 10 year US Treasury note yield declined to more than two-week lows overnight. Reckitt Benckiser Group climbed after McCormick & Company agreed to buy its foods business for $4.2 billion. RPC Group jumped after it unveiled a £100 million share buyback. Electrolux rallied in Stockholm after reporting better than expected second quarter earnings. Tele2 AB advanced — it raised its full-year guidance after posting better than expected second quarter earnings.
Volvo Group retreated even as the truck maker reported significant growth in its second-quarter profit with higher sales amid strong demand in Europe and South America. Aryzta and Lonza advanced on broker upgrades. Kuehne + Nagel advanced after the company reported better than expected results on Tuesday. UBS and Credit Suisse were higher. The bank stocks climbed in the afternoon, following the strong quarterly report from Morgan Stanley. Novartis, Roche and Nestlé gained. Royal Mail retreated along with easyJet and British Airways owner IAG. Randgold Resources, Fresnillo, BHP Billiton and Rio Tinto declined.
Asia Pacific
Asian stocks advanced Wednesday as investors remained optimistic about China’s ongoing economic transition and looked ahead to policy statements from the European Central Bank and the Bank of Japan. The US dollar stayed on the defensive on doubts that US President Donald Trump’s would be able to deliver tax reforms. Crude oil prices pulled back slightly on industry data showing a rise in US crude inventories.
The Shanghai Composite rallied 1.4 percent amid optimism that Beijing will step up efforts to transform state-owned firms. The Hang Seng added 0.6 percent.
Both the Nikkei and Topix inched 0.1 percent higher prior to the BoJ’s policy announcement Thursday. Automakers and financials declined after the US dollar slid against the yen and the 10 year US Treasury yield slid to more than two-week lows overnight. Toyota Motor Corp shed 0.8 percent, Nissan Motor, Mitsubishi UFJ Financial Group and Dai-ichi Life Holdings were lower. Shiseido, Kao and brewer Kirin Holdings were higher.
The S&P/ASX and All Ordinaries rebounded from Tuesday’s selloff. The former was up 0.8 percent and the latter was 0.7 percent higher. Banks led the gains after the bank regulator outlined its new “capital adequacy” targets, which weren’t as tough as initially feared. The big four banks jumped. BHP Billiton was lower after the miner said it would take a charge of A$740 million against its full-year profit. Rio Tinto slid to extend Tuesday’s losses after lowering its iron ore production guidance.
The Kospi was up 0.2 percent amid institutional buying on expectations that major companies will report solid second quarter earnings results. The Sensex added 0.8 percent. Encouraging earnings updates from Hindustan Unilever and Mastek helped to underpin investor sentiment.
Looking forward
The Bank of Japan and the European Central Bank announce their respective monetary policy decisions. Japan posts June merchandise trade data. Australia reports its labour force survey. The UK posts June retail sales. In the US, July Philadelphia Fed survey along with weekly jobless claims, money supply and the Fed balance sheet will be released.
Global Stock Markets

*Note — all releases are listed in local time.

Source: Fidelity

Fidelity disclaimer:

The objective of this page is to present users with objective news, information, data and guidance on personal finance topics drawn from a diverse collection of sources including affiliated and non-affiliated financial services publications. Content is not intended to provide tax, legal, insurance or investment advice and should not be construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any security or investment by any Fidelity entity or any third-party.

Jesmond Mizzi Financial Advisors Disclaimer:

This article, does not intend to give investment advice and the contents therein should not be construed as such. Jesmond Mizzi Financial Advisors Limited is licensed to conduct investment services by the MFSA and is a Member Firm of the Malta Stock Exchange. The directors or related parties, including the company, and their clients are likely to have an interest in securities mentioned in this article. For further information contact Jesmond Mizzi Financial Advisors Limited at 67, Level 3, South Street, Valletta, or on Tel: 21224410, or email [email protected]