Wall Street rises, buoyed by results, manufacturing data

New York, Reuters | Updated : 02 November 2013, 08:57 AM

US stocks rose on Saturday, rebounding following two days of losses as solar companies jumped on results and strong data on manufacturing.

Equities have been pressured since Wednesday, when a Federal Reserve statement raised concerns about when the central bank would begin to scale back its stimulus program, which has contributed to the S&P 500's advance of 23 per cent this year. Some investors interpreted comments in the statement as suggesting the Fed would begin tapering stimulus earlier than expected.

The rally has taken the Dow and S&P repeatedly to record highs, leading some analysts to call for a pullback, especially in the wake of some signs of slowing growth, like weak economic data and an earnings season marked by tepid revenue.

"I'm not comfortable with the market at all-time highs, especially with earnings being mediocre, but the manufacturing report was better than expected, and where else can you go with the Fed putting so much liquidity into the system?" said Mark Grant, managing director at Southwest Securities in Fort Lauderdale.

The US manufacturing sector expanded at its fastest pace in 2-1/2 years last month, a rate that was stronger than expected, according to the Institute for Supply Management's survey, which followed the similarly strong Chicago Purchasing Manager's Index on Thursday.

Chevron Corp was the latest company to disappoint on results as its third-quarter revenue came in below expectations. That sent shares of the Dow component down 2 per cent to $117.55.

The Dow Jones industrial average was up 81.91 points, or 0.53 per cent, at 15,627.66.

The Standard & Poor's 500 was up 6.79 points, or 0.39 per cent, at 1,763.33.

The Nasdaq Composite was up 11.75 points, or 0.30 per cent, at 3,931.46.

For the week thus far, the Dow is up 0.4 per cent, the S&P is up 0.3 per cent and the Nasdaq is down 0.2 per cent. Both the Dow and S&P are on track for their fourth straight week of gains.

American International Group Inc fell 6.3 per cent to $48.41 as the S&P's biggest decliner a day after reporting third-quarter earnings that slightly beat expectations, though analysts had expected better results in the insurer's consumer lines business.

First Solar Inc soared 13 per cent to $56.76 after its results beat expectations and the company raised its full-year profit outlook. Among its peers, Yingli Green Energy climbed 5.3 per cent to $6.32 and Canadian Solar was up 7.2 per cent to $24.62.

With about 71 per cent of S&P 500 companies having reported, 68.2 per cent have topped Wall Street's expectations, above the long-term average of 63 per cent, according to Thomson Reuters data. However, only 53.6 per cent have topped revenue forecasts, below the 61 per cent average since 2002.

In company news, Ford Motor Co shares rose 0.6 per cent to $17.21 after the company reported October sales growth of 14 per cent.

Container Store Group Inc shares jumped 93 per cent to $34.63 in their trading debut after the company priced its initial public offering at the top end of an increased price range.

First Published: Saturday, November 02, 2013 08:54 AM
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