Global Markets Overview - 10 January 2013

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By Christine Gaylican | January 10, 2013 10:59 AM EST

U.S. STOCK MARKET

Investors kicked off the latest quarterly-earnings series with broad-based gains. The Dow Jones Industrial Average rose 61 points, or 0.5%, to 13390, in Wednesday afternoon trading.

The Standard & Poor's 500-stock index added four points, or 0.3%, to 1461, while the Nasdaq Composite Index advanced 15 points, or 0.5%, to 3107.

Leading the advance were healthcare, industrial and materials stocks. Boeing bounced back 3.1% to lead the Dow components, a day after falling 2.6%. The stock remains 1.7% lower on the week, following a run of glitches with its flagship Dreamliner jet.

Among other Dow components, Alcoa rose 0.3% after the aluminum company reported late Tuesday that revenue was well above forecasts and said it expects the pace of aluminum demand growth in 2013 to increase.

Because Alcoa is the first Dow component to report results, it is seen as marking the start of the fourth-quarter earnings reporting season.

Elsewhere, United Technologies rose 1.4%, Hewlett-Packard tacked on 2.2% and UnitedHealth climbed 1.9%.

In other corporate news, Clearwire surged 7.7% after the wireless-broadband company received an unsolicited buyout bid from Dish Network that would value the company at about $4.85 billion, topping an earlier offer from Sprint Nextel. Dish rose 3.2% while Sprint pulled back 1.8%.

Herbalife rose 3.7% after Third Point, a hedge fund founded by Daniel Loeb, disclosed in a regulatory filing that it held 8.2% of the marketer of nutritional supplements and energy products.

Apollo Group plunged 7.5% to lead the S&P 500 decliners after the for-profit education company reported quarterly profits and revenue that topped analyst estimates but provided a full-year revenue outlook that was below forecasts.

Apple lost 0.5% after The Wall Street Journal reported the technology company was working on a less-expensive version of the iPhone amid increased competition. Facebook rose 4.7% to trade above $30 a share for the first time since last July.

EUROPEAN STOCK MARKETS, BONDS

European stock markets posted solid gains with banks in the lead Wednesday, gaining after Alcoa Inc. kicked off the U.S. earnings season on an upbeat note, outweighing disappointing German factory data.

The Stoxx Europe 600 index gained 0.7% to close at 288.22. U.K.'s FTSE 100 index advanced 0.7% to 6,098.65, its highest close since May 2008.

Among notable movers in the pan-European index, shares of Delta Lloyd NV jumped 6.6% after Aviva PLC said it would sell its entire remaining stake in the Dutch insurer for 12.65 euros ($16.54) a share. Shares of Aviva dropped 2.2% in London.

CGG Veritas gave up 6.2% as Goldman Sachs cut its rating on the oil-services firm to neutral from buy. Meanwhile, shares of Nokia Corp. dropped 2.5%. Media reports said the handset maker faces a patent lawsuit in China from Taiwanese touch-panel maker TPK Holding Co.; a Nokia representative wasn't immediately available to comment.

Data showed industrial production in Germany rose 0.2% in November, missing analysts' expectations for a 1% improvement. Germany ranks as the largest European economy.

The DAX 30 index briefly slipped into negative territory but recovered to close 0.3% higher at 7,720.47. Shares of Commerzbank AG rose 3.1%, while Deutsche Bank AG added 1.3%.

Risk sensitive sectors, such as banks, were among the biggest gainers in the rest of Europe. Italy's Banca Monte dei Paschi di Siena SpA added 4.9% and Banco Popolare SC climbed 4.6%.

The FTSE MIB index rallied 2.2% to 17,326.27. And in France, shares of Credit Agricole SA gained 4.6% and Societe Generale SA added 3.4%.

The CAC 40 index rose 0.3% to 3,717.45. Shares of steelmaker ArcelorMittel SA, however, slid 2.5%, as the firm said it plans to issue shares and convertible bonds to raise $3.5 billion and reduce net debt.

Banks also rallied in the U.K., among them Lloyds Banking Group PLC, up 4.9% after UBS lifted the stock to buy from neutral. Royal Bank of Scotland Group PLC gained 3.8% and HSBC Holdings PLC added 1.6%. Shares of Meggitt PLC jumped 3.8%, rallying after Bank of America Merrill Lynch lifted the aerospace and defense firm to buy from neutral.

ASIA-PACIFIC STOCK MARKETS

Asian stocks were mostly higher on Wednesday after the results season kicked off in the U.S., with the Hong Kong market rising ahead of China's next batch of economic data.

Regional markets were making a recovery after the MSCI All Countries Asia Ex-Japan index lost a combined 0.8% across Monday and Tuesday--a decline that came about after the initial relief over last week's fiscal cliff deal faded, leaving markets looking for fresh catalysts to extend the rally that started in late 2012.

The U.S. earnings season kicked off overnight Tuesday, with aluminum company Alcoa announcing it swung to a profit in the fourth quarter. Aluminum Corp. of China was up 1.1% in Hong Kong following Alcoa's results.

The focus in Asia is now on Intel's earnings next week, which could have a knock-on effect on regional technology stocks.

There were also some very early, albeit mixed, signs on Asian earnings from Japan, where two convenience store operators released figures.

Seven & i Holdings gained 1.8% after reporting a third-quarter operating profit rise of 5% year-on-year; FamilyMart slid 4.2% after the company's third-quarter results showed a 3% year-on-year fall in quarterly operating profits.

The main economic event on the Asian horizon remains the next batch of Chinese economic data.

On Thursday, China will release trade data for December, followed by inflation figures on Friday. Markets in China were mixed ahead of the data, with the Hang Seng Index up 0.5% at 23218.47, while the Shanghai Composite was flat at 2275.34 in more cautious trading.

in Hong Kong, Zoomlion Heavy Industry Science and Technology Co. dropped 6.4%, despite issuing a denial of a story in Hong Kong newspaper Ming Pao Daily relating to potential accounting fraud.

The Nikkei Stock Average recovered from early losses after the yen trimmed gains against the dollar. The index ended up 0.7% at 10578.57, with financial companies providing support: Nomura Holdings was up 3.5% and Dai-Ichi Life Insurance rose 2.5%.

Vietnam's Ho Chi Minh Index ended up 0.4% on news the Ho Chi Minh Stock Exchange would widen its daily trading band to 7% from 5% from Tuesday. South Korea's Kospi Composite was down 0.3% at 1991.81.

COMMODITIES

Base metals on the London Metal Exchange closed mostly higher after bargain hunting and some positive earnings results lifted the complex from recent lows.

At the close of open-outcry trading, the flagship of the complex, LME three-month copper, was up 0.1% on the day at $8,080 a metric ton.

U.S. crude-oil futures erased earlier modest gains Wednesday after government data showed that a sharp drop in demand in the New Year's holiday week pushed up petroleum inventories.

Data from the Energy Information Administration showed U.S. implied oil demand fell 6% in the week ended Jan. 4, to an 11-month low of 17.755 million barrels a day. Light, sweet crude oil futures for February delivery on the New York Mercantile Exchange settled 5 cents lower at $93.10 a barrel.

Gold futures finished lower, pulling back after a sizable gain in the previous session, as a stronger dollar and a climb in U.S. equities lured some investors away from the precious metal. Gold for February delivery settled down $6.70, or 0.4%, at $1,655.50 an ounce on the Comex division of the New York Mercantile Exchange. Compiled from MORRISON SECURITIES PTY. LTD.

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