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Wall Street Stays Afloat Amid Risk Appetite

Wall Street Stays Afloat Amid Risk Appetite
2/6/2013 6:37 AM ET

Wall Street's momentum has not deserted it amid its optimism about the global economy, as reflected by the U.S. index futures, which point to a higher open on Wednesday. Undeterred by the extended rally, the major averages have been relentlessly climbing. Earlier in the day, Japanese Nikkei 225 average climbed to fresh multi-year highs, as the yen sagged further. European stocks are also advancing, although amid some volatility. In the absence of any major domestic economic catalysts, traders may focus on a handful of key earnings.

As of 6:30 pm ET, the Dow futures are adding 18 points and the S&P 500 futures are up 1.40 points, while the Nasdaq 100 futures are rising 0.75 points.

U.S. stocks rebounded on Tuesday post the previous session's sell-off, as traders focused on the positive tidings on the corporate earnings and economic front.

On the economic front, the Treasury is due to make announcements concerning the auction of 3-year and 10-year notes and 30-year bonds at 9 am ET.

The Energy Information Administration is scheduled to release the results of its weekly oil inventory report for the week ended February 1st at 10:30 am ET.

In corporate news, Disney (DIS) reported first quarter earnings of 79 cents per share compared to 80 cents per share last year. Revenues rose 5 percent to $11.34 billion. The results exceeded estimates.

Liberty Global (LBTYA) released preliminary results, expecting a 23 percent increase in its fourth quarter operating profit to $501 million and revenues of $2.73 billion. Separately, the company announced a deal to buy Virgin Media (VMED) in a cash and stock deal valued at $23.3 billion.

Take-two Interactive's (TTWO) third quarter earnings were above estimates and it issued positive guidance for the full year.

Elan (ELN) announced that it would transfer the full ownership of multiple sclerosis drug Tysabri to Biogen Idec (BIIB) for $3.25 billion and additional royalty payments on the sales of the drug.

Zynga (ZNGA) reported fourth quarter adjusted earnings of 1 cent per share, trailing the consensus estimate of 3 cents per share. However, revenues exceeded estimates. The company's first quarter bottom line estimate was below expectations, while its revenue guidance was above estimates.

Expedia (EXPE) also reported below-consensus earnings from continuing operations for its fourth quarter, while its revenues topped expectations.

3M Co. (MMM) announced an 8 percent increase in its dividend to 63.5 cents per share and also said its board authorized a $7.5 billion stock buy back program. Myriad Genetics (MYGN) reported higher second quarter earnings and revenues that were above estimates. The company also raised its full year guidance.

Akamai Technology (AKAM), Atmel (ATML), CB Richard Ellis (CBG), Con-way (CNW), DeVry (DV), Digital River (DRIV), Everest Re (RE), FMC Corp. (FMC), Green Mountain Coffee (GMCR), InterActive Corp. (IACI), Leapfrog (LF), Netease.com (NTES), PartnerRe (PRE), Protective Life (PL), Prudential (PRU), RealNetworks (RNWK), RenaissanceRe (RNR), Sierra Wireless (SWIR), TriQuint Semiconductor (TQNT), Visa (V) and WMS Industries (WMS) are among the notable companies due to release their quarterly results after the close of trading.

The Asian markets closed mostly higher, tracking the buoyancy on Wall Street overnight, which improved the risk appetite and led traders towards risky bets such as equities. The Japanese market rallied strongly, as the yen continued its downward spiral.

Japan's Nikkei 225 average opened notably higher and advanced steadily thereafter before closing up 416.83 points or 3.77 percent at 11,464, its highest closing level since September 2008. The yen slid to a nearly 3-year low after Bank of Japan governor Masaaki Shirakawa announced his intention to retire by March 19th, three weeks ahead of schedule.

Australia's All Ordinaries hovered in positive territory throughout the session, ending up 37.90 points or 0.77 percent at 4,941. Hong Kong's Hang Seng Index closed at 23,257, up 108.40 points or 0.47 percent. The New Zealand market was closed for a public holiday, while the Malaysian and South Korean markets retreated.

On the economic front, a report released by the Australian Bureau of Statistics showed that Australia's retail sales fell a seasonally adjusted 0.2 percent in December, contrasting expectations for a 0.3 percent increase.

European stocks are fluctuating amid the release of mixed corporate results and disappointing German factory orders data. Orders rose 0.8 percent in December, broadly in line with expectations, although orders fell for the 12th running month on an annual basis.

In corporate news, Syngenta reported higher full year profits and sales. Meanwhile, Swedish luxury bus maker Volvo reported a 18 percent drop in fourth quarter sales to 69.92 billion Swedish Kronor, while EBITDA fell to 4.18 billion Swedish Kronor.

Arcelor Mittal (MT) reported a wider loss for its fourth quarter, while it said it sees some improvement in its steel business in 2013. easyJet reported higher passenger statistics and load factory for January. Wind turbine maker Vestas reported a loss for 2012 and lowered its shipment guidance for 2013. However, the company's fourth quarter earnings and revenues.

by RTT Staff Writer

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