|Forecast-busting Alcoa earnings shore up markets||| Print ||
|Written by PAN PYLAS, AP Business Writer|
|Tuesday, 09 April 2013 08:02|
LONDON (AP) — Forecast-busting earnings from aluminum company Alcoa Corp. shored up markets Tuesday at the start of the first-quarter U.S. corporate reporting season in spite of ongoing concerns over North Korea, bird flu in China and Europe's debt crisis.
Alcoa, as is traditional, kicked off the reporting season in an after-hours statement Monday with first-quarter earnings of 11 cents a share, well ahead of expectations of 8 cents. Despite a fall in revenues, Alcoa saw demand for aluminum growing 7 percent in 2013, with gains cutting across many industries.
"The latest U.S. earnings season started with a flourish last night after Alcoa beat estimates and this does seem to be helping stocks," said Mike McCudden, head of derivatives at stockbroker Interactive Investor.
In Europe, the FTSE 100 index of leading British shares was up 0.3 percent at 6,298 while Germany's DAX rose 0.2 percent to 7,677. The CAC-40 in France was 0.5 percent higher at 3,688.
The improved mood in Europe has also helped the euro consolidate over the past few sessions. It was trading another 0.2 percent higher at $1.3043.
"Concerns remain however as European officials head off to Greece and Portugal as both countries wrestle with issues with respect to their respective bailout programs," said Michael Hewson, senior market analyst at CMC Markets.
Wall Street was poised for a fairly flat opening, with both Dow futures and the broader S&P 500 futures unchanged.
Much of the focus in markets will remain on the U.S. corporate sector over the coming couple of weeks as investors seek to assess the health of the world's largest economy. The flow of earnings picks up through the week with banks Wells Fargo and JPMorgan Chase due to report on Friday.
Another key focus will be Japanese financial assets.
The Nikkei 225 index in Tokyo has posted strong gains over the past week as the Bank of Japan unveiled an aggressive new approach to shake the world's third-largest economy out of its near-two-decade stagnation and growth-crippling deflation. The bank will pump huge amounts of money into the economy via government bond purchases and pursue a 2 percent inflation target in order to spark lending and spending.
Earlier, the rally ran out of stream and the Nikkei edged down slightly to close at 13,192.35. However, the yen continues to push four year lows against the dollar, and was trading 0.8 percent lower at 98.83 yen. It hasn't breached 100 yen since April 2009.
Gains in Hong Kong and mainland China markets reflected a decreasing sense of alarm over the outbreak of a new bird flu strain in eastern China that has killed seven people so far. There is no sign that the virus is being transmitted from human to human.
Hong Kong's Hang Seng rose 0.7 percent to 21,870.34 and the Shanghai Composite Index added 0.6 percent to 2,225.77. The smaller Shenzhen Composite Index advanced 0.8 percent to 926.22.
Another focus in Asia has been the rise in tensions between the two Koreas, as Pyongyang recalled all its workers from the Kaesong industrial complex, the last major economic link between South Korea and North Korea. South Korea's Kospi rose 0.1 percent to 1,920.74 but the country's currency, the won, hovered at its lowest levels since July 2012.
Oil prices were steady, with the benchmark New York rate up 22 cents at $93.58 a barrel.
Pamela Sampson in Bangkok contributed to this report.
Copyright 2013 The Associated Press.