Dow Jones:11,416.30 (–16.88) Nasdaq:2,583.03 (+16.98) S&P 500:1,195.54 (+0.65)
ALMOST ALL US stocks rose yesterday, following the biggest rally since August for the Standard and Poor’s 500 Index, as optimism about third-quarter corporate earnings overshadowed concern about Europe’s debt crisis.
Alcoa, the biggest US aluminum producer, gained 2.6 per cent to $10.35 ahead of its results.
Apple, Bank of America and Caterpillar added at least 2 per cent to pace gains among companies most-tied to the economy.
Mosaic jumped 4.4 per cent as Credit Suisse Group said valuations for fertilizer shares are attractive.
AMR rose 6.7 per cent as American Airlines joined its bigger US peers with deeper seating cuts.
About seven stocks rose for every five that fell on US exchanges in New York.
“The markets have shrugged off some of the pessimism,” Peter Tuz, who helps manage about $800 million as president of Chase Investment Counsel in Charlottesville, Virginia, said. “There’s a bit of catch-up going on. We’re seeing a recovery in groups that have really taken it on the chin. Beginning with Alcoa today, only time will tell if earnings won’t be quite as bad as we all feared.”
The S&P 500 last week rose from the threshold of a bear market on optimism Europe will tame its debt crisis.
Earnings per share for the S&P 500, excluding financial companies, rose 14 per cent in the third quarter, according to analysts’ estimates compiled by Bloomberg. Still, it’s the smallest gain since the end of 2009, the data showed.
Alcoa is the first company on the Dow to report results for the third quarter. The largest US aluminum producer may report a slowdown in its earnings recovery after the lightweight metal used in beverage cans and aircraft erased all this year’s price gains.
“Sovereign stress has moved from smaller economies to some of the larger countries,” Mr Trichet told European lawmakers in Brussels. “The crisis is systemic and must be tackled decisively.”
The message comes as Slovakian lawmakers were preparing to vote on the euro region’s retooled bailout fund.
European Union and International Monetary Fund officials indicated Greece will get an €8 billion ($11 billion) loan next month under a €110 billion bailout. – (Bloomberg)
