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July 23, 2014 at 06:48 AM
(Bloomberg) — U.S. and European stocks rose as earnings from Daimler AG to Microsoft Corp. beat estimates. Emerging-market shares advanced to an 18-month high as Indonesia’s rupiah led gains among higher-yielding currencies.
The Standard & Poor’s 500 Index increased 0.2 percent to a record 1,987.41 at 9:33 a.m. in New York. The Stoxx Europe 600 Index climbed 0.2 percent and the MSCI Emerging Markets Index rose 0.3 percent. The rupiah strengthened 0.7 percent against the dollar and Russia’s ruble gained 0.4 percent. The yield on 10-year Treasuries fell 1 basis point to 2.46 percent. Oil advanced 0.3 percent.
Daimler, the world’s third-largest maker of luxury vehicles, said second-quarter profit climbed 12 percent, while Microsoft revenue and earnings topped forecasts. Boeing Co., Dow Chemical Co., PepsiCo Inc., Facebook Inc. and AT&T Inc. are among companies reporting today, with about 78 percent of U.S. companies that have posted results this earnings season beating analysts’ estimates.
The European Union weighed limiting Russia’s access to capital markets as a train carrying bodies from flight MH17 arrived in Kharkiv, Ukraine.
“You’ve had some very good earnings released so far,” Peter Garnry, head of equity strategy at Saxo Bank A/S in Hellerup, Denmark, said by telephone. “When we look across the market, it seems calm and the macro picture is still supporting equities.”
Profits at S&P 500 members probably rose 6.2 percent in the second quarter, while sales gained 3.3 percent, according to analyst estimates compiled by Bloomberg.
Apple, Microsoft
Apple Inc. rose 0.8 percent even after reporting a drop in iPad demand and projecting third-quarter revenue below analysts’ predictions. Juniper Networks Inc. declined 9.2 percent as its estimates trailed expectations.
Microsoft advanced 1.2 percent. The software maker said its purchase of Nokia Oyj’s mobile business dragged down fiscal profit, while it benefited from improving corporate demand for computers and software delivered over the Web.
The S&P 500 increased 0.5 percent yesterday after inflation data signaled the Federal Reserve won’t be compelled to raise interest rates in the near future. Fed Chair Janet Yellen has said rates will stay low for a “considerable time” after the central bank stops its monthly bond purchases. It is on track to end them in October. The benchmark index has advanced 7.3 percent this year through yesterday amid better-than-estimated corporate earnings and central bank stimulus, as the U.S. economy shows signs of recovering from a 2.9 percent contraction in the first quarter.
European Earnings
The Stoxx 600 rose after climbing 1.3 percent yesterday. Auto companies posted the biggest gain among 19 industry groups in the gauge, with Daimler adding 0.5 percent.
Telenor ASA advanced 2.6 percent after the largest phone company in the Nordic region said it expects this year’s profit margin to improve from 2013. Akzo Nobel NV, Europe’s biggest paintmaker, rallied 5.3 percent.
“Usually we have [much] lighter volume at this time of year and negative geopolitical news would drive the market down more than it has. But the economy is better fundamentally than most people think it is,” Kurt Cambier, senior partner at Littleton, Colorado-based Centennial Capital Partners, said in a phone interview.
The Micex Index of Moscow shares dropped 0.5 percent after earlier rising as much as 1.1 percent. The ruble strengthened for a second day to 34.84 per dollar.
The EU yesterday threatened to restrict Russia’s access to capital markets and sensitive energy and defense technologies unless President Vladimir Putin expedites a probe into the downing of the Malaysia Airlines plane over eastern Ukraine last week that killed all 298 on board.
