Stocks Move Higher as Earnings Drive Gains
Stocks moved higher on the open as strong earnings results combined with Chinese liquidity helped equity bourses move into the black. The PBOC reportedly injected 255 billion into the banking system via 7 and 21-day reverse repos, the first such injection since December 23, 2013. German markets were a slight drag after the country reported worse than expected confidence numbers. US bourses closed mixed with the Nasdaq and S&P 500 closing in the black and the Dow Industrials closing in the red.
The DAX remained buoyed despite soft confidence news released in Germany on Tuesday. The German ZEW survey declined to 61.7 in January from a seven-year high of 62 in December and missed consensus of 64. On a positive note, the current situation reading surged to 41.2 from 32.4, while sentiment for the Eurozone has also climbed. Chinese GDP slowed to +7.7% year over year in the 4th quarter from +7.8% in Q3 but topped consensus estimates of +7.6%. For 2013, GDP was +7.7%, as in 2012.
Verizon (NYSE:VZ) reported fourth-quarter net income of $5.07 billion, beating analysts’ expectations. The largest U.S. cellphone carrier’s profit increased to $1.76 per share. The company lost $4.23 billion, or $1.48 per share, in the year-ago period. Excluding one-time items, the company says it posted an adjusted profit of 66 cents per share. Revenue rose 3 percent to $31.07 billion from $30.05 billion. Analysts expected a profit of 62 cents per share on $31.04 billion in revenue. After the closing bell IBM releaed earnings that were better than expected.
The Fed is expected to continue to reduce its bond purchase program when it meets this month as many believe the FOMC is determined to end its quantitative easing. The Fed is expected to drop 10 billion per month from the current program dropping it down to 65 billion dollars per month.
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