Overseas Market Report – Stocks End Higher as Oil Prices Rebound
U.S. stocks finished sharply higher Tuesday as energy stocks soared amid a rally in oil prices.
Oil futures rose above US$30 a barrel again on news that OPEC members may be open to "cooperation" in reducing oil output.
Big earnings-driven gains in market bellwethers added steam to the rally as Wall Street sought to find its footing after what has so far been an awful start to 2016.
U.S. home price gains accelerated in November, according to the Case-Shiller index. The 20-city index was up 5.8% year over year in the month, compared to a 5.5% annual gain in October. San Francisco, Portland and Denver saw the biggest gains in the month.
At the close, the Dow, the S&P 500 and the NASDAQ were up 1.8%, 1.4% and 1.1%, respectively.
For Australian ADRs listed on the NYSE, BHP Billiton rose 126 cents (6.07%) to $22.01, ResMed gained 36 cents (0.61%) to $59.02, Telstra Corporation rose 33 cents (1.72%) to $19.55, Spark New Zealand lifted 7 cents (0.67%) to $10.53 and Westpac rose 46 cents (2.18%) to $21.60.
At 7:45 AM (AEDT), the 10-year Treasury note yield was 2% and the 5-year yield was 1.44%.
Procter & Gamble's (PG) organic sales, which exclude the impact of currency, rose 2% in the fourth quarter after a fall in the third. The rise came as the firm was able to boost prices 3% even as volumes declined 2%. On an adjusted basis, the firm earned US$1.04 a share, above the 98 cents per share expected by analysts.
Shares of Johnson & Johnson (JNJ) were up after the firm reported better-than-expected earnings. Overall sales were down 2.4% in the fourth quarter due to currency impacts, but sales in the U.S. pharmaceutical segment were strong.
DuPont (DD) also felt the impact of the strong dollar on its quarterly results. The firm also said it is planning on cutting US$1 billion in costs out of the business ahead of its planned merger with Dow Chemical (DOW).
3M (MMM) reported a better-than-excepted profit. The firm earned US$1.66 per share versus expectations it would earn US$1.33. Still, organic sales were down 1.1% due to pressures from a slow global economy.
European markets erased early losses to end higher.
The FTSE 100, Germany's DAX and the French CAC 40 were up 0.6%, 0.9% and 1.1%, respectively.
In Asia, Chinese shares plunged.
The Shanghai Composite slipped 6.4%, while the Hang Seng was down 2.5%. The Nikkei 225 was off 2.4%, while India's Sensex gained 0.2%
Australian Market Report – Local Market Expected To Open Higher
Ahead of the local open, SPI futures were 54 points higher at 4,953.
Local markets were closed on Tuesday due to the Australia Day national holiday.
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