Saturday 20 October 2018

Earnings lift global stocks as geo-political fears ease

'S&P 500 companies are expected to post an 18.6pc rise in profits in the first quarter, the biggest increase in seven years, according to Thomson Reuters data.' Stock photo: Reuters
'S&P 500 companies are expected to post an 18.6pc rise in profits in the first quarter, the biggest increase in seven years, according to Thomson Reuters data.' Stock photo: Reuters

The US benchmark S&P 500 index posted slight gains on Wednesday, helped by gains from industrial and energy stocks, but IBM's disappointing results and a sell-off in semiconductor stocks weighed on the Nasdaq and the Dow.

With earnings season now in full swing, IBM fell 6.2pc after the company reported quarterly profit margins that fell short of Wall Street expectations.

Semiconductor stocks also took a hit, led by Lam Research's 5pc drop after what analysts called a disappointing shipment forecast. The S&P technology index fell about 0.5pc.

Not all results were disappointing, however. Morgan Stanley rose 3pc after it reported a 40pc jump in quarterly profit, driven by its trading business.

United Airlines rose 1.6pc after reporting a rise in profit and CSX Corp jumped 7pc after the railroad operator topped profit estimates.

Oil prices jumped about 2pc, lifted by a reported decline in US crude inventories and the risk of supply disruptions. Exxon and Chevron were up about 1.3pc.

S&P 500 companies are expected to post an 18.6pc rise in profits in the first quarter, the biggest increase in seven years, according to Thomson Reuters data.

Stocks have gained solidly in the past two days after strong results from industry bellwethers as well as positive economic data helped investors turn attention away from geopolitical and trade tensions.

In London, a positive start to the first-quarter earnings season and a softer pound triggered by weak inflation data helped lift shares index.

Here, the Iseq index was up more than half a percent

The blue-chip index was up 0.85pc at 7,286 points in early trading, slightly outperforming other European bourses.

Corporate news also triggered sharp moves, with property company Hammerson withdrawing its recommendation to shareholders that they back a takeover of smaller rival Intu Properties, citing softness in the UK retail property market and shareholder pressure.

Hammerson rose 1.7pc while Intu Properties slid by 5.7 percent.

In Dublin, shares in IFG saw big swings after it announced a raft of senior changes including the departures of the CEO and chairman. Shares swung between a high on the day of €1.90 each to lows of under €1.80.

Indo Business

Business Newsletter

Read the leading stories from the world of Business.

Also in Business