U.S. STOCKS, BONDS
U.S. stocks rallied broadly Friday, pushing the Standard & Poor's 500-stock index to a five-year high, as Wall Street braced for a blizzard.
The Dow Jones Industrial Average rose 48.92 points, or 0.35%, to 13992.97, erasing the previous day's decline of 42 points. In intraday trading, the Dow industrials briefly rose above the 14000 level for the first time since Tuesday.
European and U.S. markets will dictate global markets this week as major markets in Asia are still close for the Lunar New Year holidays.
The Standard & Poor's 500-stock index advanced 8.54 points, or 0.57%, to 1517.93, its highest level since November 2007. The S&P 500 has now notched up six straight weeks of gains to start the year.
A strong showing by technology stocks pushed the Nasdaq Composite up 28.74 points, or 0.91%, to 3193.87, its highest level in 12 years.
The broad day of gains also pushed the Russell 2000 index of small-capitalization stocks and the Dow Jones Transportation Average to record levels.
Among Dow components, Hewlett-Packard rose 2.6%, extending its yearly gain to 18%. Tech giants Microsoft and International Business Machines each gained about 1%, helping push the blue-chip index higher.
Microchip Technology soared 7.2%, topping the S&P 500 advancers after the semiconductor maker boosted its earnings estimates for the current quarter.
Apple gained 1.4% a day after the company said it would evaluate a proposal by hedge-fund manager David Einhorn to issue some form of preferred stock.
The moves came as traders on Wall Street braced for a major blizzard bearing down on the Northeast.
About 2.9 billion shares changed hands in New York Stock Exchange composite trading, well below the daily average this year of about 3.5 billion shares traded.
Generac Holdings, a maker of portable generators that surged to an all-time high after Superstorm Sandy hit the Atlantic coast in November, climbed 2% to $40.54, a fresh record. Home Depot and Lowe's, which sell home-improvement supplies, tacked on 1.1% and 0.7%, respectively.
EUROPEAN STOCKS, BONDS
Solid trade data from both China and the U.S. spurred a risk-on sentiment across financial markets Friday, sending European stocks higher, with banks leading the charge.
The Stoxx Europe 600 index rose 1.2% to close at 287.34. Friday's gains weren't enough, however, to push the index into positive territory for the week, leaving it with a 0.3% weekly decline.
Among country-specific European bourses, France's CAC 40 index rallied 1.4% to 3,649.50, but lost 3.3% for the week; the U.K.'s FTSE 100 index gained 0.6% to 6,263.93, but lost 1.3% for the week; Germany's DAX 30 index climbed 0.8% to 7,652.14, trimming its weekly loss to 2.3%.
Europe's political leaders agreed on a seven-year budget plan for the European Union. The deal will cap government contributions to the E.U. budget at EUR959 billion ($1.29 trillion), a EUR35 billion decrease after adjusting for inflation from the last seven-year budget and down from EUR1.03 trillion the European Commission, the E.U.'s executive, had originally proposed.
Shares of DNB ASA rose 4.6% after Credit Suisse lifted the Norwegian bank to neutral from underperform following a better-than-expected earnings report earlier in the week.
On a downbeat note, shares of Telecom Italia SpA fell 1.3%. The firm said it didn't meet its 2012 targets for gross operating profit and net debt reduction. Shares of SSAB AB slumped 5.1%, after the Swedish steelmaker posted a wider-than-expected operating loss in the fourth quarter and cut its dividend.
ASIA-PACIFIC STOCKS, BONDS
Asian markets were trading mostly higher Friday after China released economic data, while Japan moved further away from the multi-year high it reached earlier in the week.
China's first dose of data for the day were trade numbers, which showed that the trade surplus narrowed to $29.2 billion for January from $31.6 billion in December but still beat a median $26.6 billion forecast by economists polled in a Dow Jones Newswires survey.
This was followed later in the session by China's consumer price index, which rose 2% in January from a year earlier, slower than a 2.5% on-year rise in December and in line with the median forecast of 14 economists that took part in a Dow Jones survey.
In mainland China, the Shanghai Composite Index was up 0.6% to 2432.40, while in Hong Kong the Hang Seng Index was up just 0.2% to 23215.16.
Friday was the last day of trading ahead of the Lunar New Year, which includes long public holidays in some of Asia's largest markets.
Exchanges in mainland China and Taiwan will be closed for the holiday all of the coming week, while stocks in Hong Kong will resume trade Feb. 14.
Earlier in the session, Japan announced that its current account balance notched its second straight monthly deficit, as exports remain sluggish despite a weaker yen.
The Y264.1 billion shortfall in December was significantly wider than the Y148.5 billion deficit forecast by economists surveyed by Dow Jones Newswires and the Nikkei.
Japanese stocks retreated for a second session, with the Nikkei Stock Average down 1.8% to 11153.16, as the market continued to retreat from the multi-year high reached after a dramatic day of trading Wednesday, when the local benchmark soared 3.8%.
Stocks in Tokyo were weighed by some disappointing earnings reports. Sony Corp. sank 10.1% after the electronics company posted a surprise loss for the third quarter--a Y10.8 billion net loss significantly undershot consensus expectations for a profit of over Y20 billion.
Suzuki Motor Corp. dropped 5.4% after its consolidated operating profit in its most recent quarter came out below consensus estimates.
Despite the surge earlier in the week, the Nikkei finished the week down 0.3%. Most other regional markets ended the week lower or with small gains, due to the absence of fresh catalysts to extend the Asian rally. Hong Kong's Hang Seng Index was down 2.1% for the week and South Korea's Kospi Composite was down 0.4%.
Base metals on the London Metal Exchange closed higher Friday after China trade date lifted buying interest, although analysts said near-term trading is likely to remain choppy as Lunar New Year celebrations in China start over the weekend.
At the close of open-outcry trading, LME three-month copper was 1.1% higher at $8,293 a metric ton, defying the euro which it had tracked lower Thursday and which had drifted lower over Friday's session.
U.S. crude-oil futures settled slightly lower Friday on renewed concerns about a glut of crude oil in the Midwest. However, the European crude benchmark, Brent futures, rose 1.4% to their highest level in eight months.
West Texas Intermediate light, sweet crude oil for March delivery settled 11 cents, or 0.1%, lower at $95.72 a barrel on the New York Mercantile Exchange.
Gold slipped, locking in a loss for the week, as some improving economic data and an upcoming holiday in major consumer China pushed traders to cash out ahead of the weekend. The most actively traded contract, for April delivery, fell $4.40, or 0.3%, to settle at $1,666.90 a troy ounce on the Comex division of the New York Mercantile Exchange, the lowest since Jan. 31. COMPILED FROM MORRISON SECURITIES PTY. LTD.
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