While you were sleeping: Stocks eke out gain

While you were sleeping: Stocks eke out gain

(BusinessDesk) April 20 - Equities on Wall Street eked out gains, supported by a renewed focus on corporate earnings. Investors welcomed results of Johnson & Johnson but were less than impressed by those of Goldman Sachs Group Inc.

In early afternoon trading on Wall Street, the Dow Jones Industrial Average rose 0.49%, the Standard & Poor’s 500 Index advanced 0.46% and the Nasdaq Composite Index was up 0.14%.

There was good news, and bad, on the earnings front. Johnson & Johnson was the top percentage gainer on the Dow after beating expectations with its first-quarter profit.

However, Goldman Sachs posted a 72% drop in quarterly earnings as trading revenue fell, and warned that there were fewer opportunities to make money in this environment.

Seagate Technology Plc dropped after forecasting a weak outlook and announcing a US$1.4 billion acquisition, while Texas Instruments Inc was lower after yesterday’s warning of slower-than-usual quarterly sales growth.

"Unless the performance of financials and tech stocks improve, then I think the market could be in store for a correction," Marshall Front, chairman and chief investment officer at Front Barnett Associates in Chicago, told Reuters.

"These are important groups that point toward future economic activity," Front said, adding that bank results "have by and large been disappointing."

In Europe, the Stoxx 600 Index rose 0.5%. LVMH Moet Hennessy Louis Vuitton SA, among others, reported earnings that beat expectations.

The greenback declined 0.56% against a basket of major currencies.

Meanwhile, U.S. crude oil rose while Brent seesawed, underpinned by U.S. Treasury Secretary Timothy Geithner’s comments that there was "no risk" the nation would lose its AAA credit rating, after Standard & Poor's yesterday downgraded its outlook for the U.S. from stable to negative.

Brent crude for June was steady at US$121.61 a barrel by 1735 GMT.

U.S. crude for May rose 89 cents to US$108.01.

"We had a test of last week's low and the weaker [U.S.] dollar and U.S. equities rebounding so far all helped crude," Chris Dillman, analyst at Tradition Energy in Stamford, Connecticut, told Reuters.

Bullion rose to a record for a second straight day.

"It's follow-through buying from yesterday after the market had absorbed an initial bout of profit-taking. The recovery of oil prices and the euro have combined to take gold to the US$1,500 level," James Steel, chief commodity analyst of HSBC, told Reuters.

U.S. gold futures for June delivery settled up US$2.20 at US$1,495.10 by 2.00pm EDT, after climbing to record US$1,500.50 an ounce earlier in the session.

Spot gold was up 0.1% to US$1,496.69 an ounce.

Silver also rose, hitting a 31-year high of US$43.79 an ounce. Silver has outperformed gold this year, gaining more than 40% so far against gold's 5% advance.

(BusinessDesk)

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