US stocks up
US stocks have ended higher overnight as investors look forward to the kickoff of earnings season.
The Dow Jones Industrial Average rose 88.85 (0.59 per cent) to 15,224.69.
The broad-based S&P 500 increased 8.57(0.53 per cent) to 1,640.46, while the tech-rich Nasdaq Composite Index added 5.45 (0.16 per cent) to 3,484.83.
Investors were not expecting especially impressive earnings for the second quarter.
Current forecasts suggest profit growth of just 0.8 per cent and revenue growth of only 1.2 per cent from S&P 500 companies, said Briefing.com analyst Patrick O’Hare.
However, investors will focus more on what companies say about the rest of the year, analysts said.
The hope is that Friday’s strong jobs report and other recent indicators of economic improvement will translate into better earnings in the second half of 2013.
“Investors realise we did not have blockbuster growth in the first half, but they are focused on the quarters ahead,” said Alan Skrainka, chief investment officer at Cornerstone Wealth Management.
“The stock market is forward-looking.”
Leading banks scored outsized gains, including Citigroup (up 2.0 per cent) Wells Fargo (up 1.8 per cent) and Bank of America (up 1.7 per cent).
The gains followed a bullish report from Raymond James, which sees stronger asset quality fuelling earnings growth in the sector, according to Barrons.com.
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Retail giant Walmart also had a good day, rising 2 per cent.
Computer company Dell jumped 3.1 per cent to $US13.34 after the closely-watched Institutional Shareholders Services advisory group endorsed a proposed transaction led by Dell founder Michael Dell to take the company private. The offer would pay $US13.65 per share.
Bond prices rose. The 10-year Treasury fell to 2.64 per cent compared with 2.71 per cent on Friday.
The yield on the 30-year bond declined to 3.64 per cent from 3.68 per cent. Bond prices and yields move inversely.
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