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Banks, Apple drive Wall St higher

Banks, Apple drive Wall St higher
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First Published: Fri, Apr 24 2009. 09 12 AM IST
Updated: Fri, Apr 24 2009. 09 12 AM IST
New York: US stocks rose in volatile trade on Thursday as better-than-expected results from several regional banks lifted financial shares, overshadowing disappointing economic data and anemic outlooks from economic bellwethers like United Parcel Service.
Earnings from big US regional banks, including PNC Financial Services Group Inc and Fifth Third Bancorp, provided glimmers of hope for a sector damaged by climbing loan losses as the recession lingers.
But investors wrestled with the possibility that the federal government’s “stress tests” on 19 major US banks may reveal weaknesses, which created volatility throughout the session. The government is set to unveil results on 4 May.
“It’s still about the banks. We’re all still wondering about the stress tests,” said Frank Lesh, a futures analyst and broker at FuturePath Trading LLC in Chicago.
Solid results from companies such as Apple Inc also appeased investors. Apple shares rose 3.2% to $125.40 on strong sales of iPhones and iPods, making it the Nasdaq’s top advancer.
The Dow Jones industrial average gained 70.49 points, or 0.89%, to 7,957.06. The Standard & Poor’s 500 Index rose 8.37 points, or 0.99%, to 851.92. The Nasdaq Composite Index added 6.09 points, or 0.37%, to 1,652.21.
In contrast, United Parcel Service Inc slid 2.6% to $53.33 after it said profits were hurt by the economic downturn and forecast second-quarter results below expectations.
US government data showed existing homes sales fell in March to a much lower-than-expected annual rate, while weekly initial jobless claims rose slightly more than expected.
Barring a surprising advance on Friday, Wall Street stocks were on track to snap a six-week streak of gains.
Energy shares also gained as the price of crude rose 1.6%, lifting Chevron Corp shares 2.8% to $65.53. Chevron contributed the most to the blue-chip Dow’s advance.
Financial shares may get a lift on Friday after American Express reported its first-quarter earnings after the closing bell, sending its stock up 6.3% to $22.30 in extended-hours trading.
Shares of Microsoft climbed 4.3% to $19.73 after the bell. Microsoft, the world’s largest software company, posted a quarterly profit that met Wall Street’s expectations after the regular trading session ended.
Online retailer Amazon.com added 1.2% to $81.60 in extended trading after reporting a rise in revenue of 18 percent and earnings that topped analysts’ estimates.
The broader S&P 500 is up nearly 26% from its bear-market closing low on 9 March. While some profit-taking was not unexpected after the impressive rally, analysts said declines could be countered by investors who missed the rally and who are looking to get back into the market.
Shares of PNC Financial rose 7.5% to $40.93 on the New York Stock Exchange, while Fifth Third’s stock gained 3.5% to $3.82 on the Nasdaq. The Holders Regional Bank Sector ETF added 5.4%.
Internet auction and marketplace giant eBay Inc also helped lift the Nasdaq after quarterly earnings topped Wall Street’s expectations. Shares of eBay surged 12.3% to $16.62.
Trading was moderate on the New York Stock Exchange, with about 1.57 billion shares changing hands, slightly above last year’s estimated daily average of 1.49 billion, while on Nasdaq, about 2.49 billion shares traded, above last year’s daily average of 2.28 billion.
Advancing stocks outnumbered declining ones on the NYSE by a ratio of about 3 to 2. In contrast, on the Nasdaq, about eight stocks fell for every five that rose.
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First Published: Fri, Apr 24 2009. 09 12 AM IST
More Topics: Markets | US | Stocks | Wall Street | DowJones |