Global stocks rise on corporate earnings, ahead of Fed

AP News
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Posted: Jul 26, 2017 8:09 AM
Global stocks rise on corporate earnings, ahead of Fed

HONG KONG (AP) — World stock markets rose Wednesday, lifted by generally positive corporate earnings and as investors kept a cautious eye on the Fed's upcoming interest rate decision.

KEEPING SCORE: In Europe, France's CAC 40 added 0.5 percent to 5,184 and Germany's DAX climbed 0.2 percent to 12,287. Britain's FTSE 100 rose 0.4 percent to 7,461. U.S. shares were poised to open higher. Dow futures were up 0.2 percent and the broader S&P 500 futures edged up 0.1 percent.

FED IN FOCUS: The U.S. central bank's policymaking committee is holding a two-day meeting, where most analysts expect officials to keep rates unchanged. The Fed has already raised rates three times since December and market watchers don't expect another hike until later this year or in 2018.

ANALYST VIEW: "Investors most probably will use this opportunity to closely scrutinize the policy statement for clues on the Federal Reserve's tightening plan," said Lukman Otunuga, an analyst at FXTM. He added that markets will also be looking for hints on how the Fed plans to reduce its massive $4.5 billion in bond holdings and its view on inflation.

EARNINGS SEASON: Investors are assessing the latest round of quarterly earnings reports. Better than expected profits at U.S. companies like McDonald's and Caterpilllar helped propel Wall Street to another record day. On Wednesday, Ford and Coca-Cola also did better than expected. Carmaker Daimler and drugs company GlaxoSmithKline did not do as well. And in Asia, Nintendo Co.'s Switch hybrid game machine helped the Japanese video-game maker swing into a $190 million profit from a loss from the previous year. South Korean automaker Hyundai Motor's profit fell by half because of weakness in its SUV lineup.

ASIA'S DAY: Japan's benchmark Nikkei 225 index climbed 0.5 percent to close at 20,050.16 but South Korea's Kospi index slipped 0.2 percent to 2,434.51. Hong Kong's Hang Seng index added 0.3 percent to 26,941.02 and the Shanghai Composite index edged up 0.1 percent to 3,247.67. Australia's S&P/ASX 200 rallied 0.9 percent to 5,776.60. India's Sensex gained 0.3 percent to 32,338.57 and benchmarks in Southeast Asia were mostly higher.

ENERGY: The benchmark U.S. crude future added 50 cents to $48.39 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose $1.55, or 3.3 percent, to settle at $47.89 per barrel on Tuesday. Brent crude, the international standard, gained 40 cents to $50.60 a barrel in London.

CURRENCIES: The dollar weakened to 111.81 yen from 111.91 yen late Tuesday. The euro slipped to $1.1646 from $1.1649.

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