Europe's debt woes have taken a toll
on stocks at times during the past two years and more recently have manifested
themselves in lackluster corporate results. The most recent disappointments
came from United Technologies and Dow Chemical, which blamed overseas demand for weak results.
Draghi hinted the ECB would target high
sovereign bond yields, a measure the ECB has been reluctant to take in the
past. Policymakers have made similar statements about saving the euro before,
but if these remarks result in decisive action in European bond markets, it
could spur a sizable rally in stocks.
"It's certainly a vote of
confidence," said Kathy Karlic, chief client officer at Wilmington Trust
Investment Advisors in Buffalo, New York, which has $20 billion in assets under
management.
"The wall of worry for the euro
zone has always been there, but another round of liquidity is very
positive." Shares in sectors more sensitive to
risks in Europe and economic demand, such as energy-related stocks and
industrials, were among the day's best performers, with the S&P 500 energy
index up 2.7 percent.
Worries about Europe have also
pressured earnings forecasts, with third-quarter S&P 500 earnings now seen
falling for a year-over-year decline.
Diversified manufacturer 3M,
whose stock rose 2.1 percent to $90.59 after its results beat estimates, helped
boost the Dow and was among the brighter spots of the earnings season.
Zynga shares ended down 37.5 percent at $3.17 after hitting an all-time low, a day
after the company slashed its profit outlook after fading enthusiasm for its
games on Facebook.
After the closing bell, shares of
Facebook tumbled 11 percent to $23.87 after reporting its first
quarterly results since Facebook's market debut. During the regular sessions
its shares lost 8.5 percent.
Amazon.com shares were down 0.5 percent at $218.88 after the close following the release
of its results. The online retailer forecast third-quarter revenue that lagged
Wall Street's projections.
During the regular session, shares
of Sprint Nextel Corp jumped 20.2 percent to $4.05 after the company posted
earnings.
Sales performance this reporting
period has lagged earnings. With results in from about half of the S&P 500
companies, 65 percent have beaten analyst earnings estimates but just 41
percent have beaten on revenue, Thomson Reuters data showed.
The Dow Jones industrial average was up 211.88 points, or 1.67 percent, at 12,887.93. The Standard & Poor's
500 Index was up 22.13 points, or 1.65 percent, at 1,360.02. The
Nasdaq Composite Index was up 39.01 points, or 1.37 percent, at 2,893.25.
Shares of United Technologies ended
up 0.4 percent at $72.93 while shares of Dow Chemical dropped 3.6 percent to
$29.18.
The S&P 500 ended above the
technically important 1,333 level, and a sustained move above that level is
seen as bullish. The level marks a convergence of several technical factors,
including the index's 50-day moving average, and has served as support for
stocks.
In economic news, the number of
Americans filing new claims for jobless benefits fell last week near a
four-year low, although the figures have been volatile due to summer factory
shutdowns. Durable goods orders for June were better than expected, but a slip
in pending home sales underscored the fragility of the economy.
Volume was 7.44 billion shares on
the New York Stock Exchange, the Nasdaq and Amex, compared with the
year-to-date daily average of 6.74 billion shares.
Advancers beat decliners on the NYSE
by about 11 to 4 and on the Nasdaq by about 2 to 1.
NYMEX- NEW YORK,NEW YORK, July 26 (Reuters) - U.S. crude futures rose for a third straight day on Thursday after European Central Bank President Mario Draghi said the ECB was ready to do whatever was necessary within its mandate to avoid a euro zone collapse, and on supportive U.S. jobless claims data.
CBOT SOYBEAN- Chicago Board of Trade soybean futures declined on some improvement in crop weather prospects in the drought-stricken U.S. Midwest and on profit-taking.
* Little change was noted in midday
weather updates indicating drought stress on U.S. corn and soybean crops is
likely to continue for at least the next couple of weeks, an agricultural
meteorologist said on Thursday.
- "There are only minor changes, a little drier in
Indiana and Ohio for the next couple of days, a little more rain for Illinois
Sunday and Monday," said Andy Karst, meteorologist for World Weather
Inc.
- The extended weather outlook for the first week of
August indicated a stronger high-pressure ridge over the U.S. Plains but
there could "still be some rain," he said. "It looks drier
in Iowa, Illinois and Indiana and a little wetter in the north from August
7-10," Karst said.
- The most extensive drought in five decades intensified
this week across the U.S. Midwest and Plains states that produce most of
the country's corn, soybeans and livestock, a report from climate experts
showed on Thursday.
- USDA's weekly export sales report showed net export
sales of U.S. soybeans last week at 710,500 tonnes, above estimates for
350,000 to 550,000 tonnes.
- August is above all key moving averages. The nine-day
RSI is at 58.
FCPO- SINGAPORE,SINGAPORE, July 26 (Reuters) - Malaysian crude palm oil fell to its lowest in more than five weeks on Thursday, as investors turned more bearish on forecasts for rain in parts of the U.S. Midwest that could bring some relief to the drought-hit soy crop.
A larger supply of soybeans to be
crushed into vegetable oil could narrow spreads between soybean oil and palm
oil and draw demand away from the tropical oil.
Market players also priced in weaker
Malaysian exports for the July 1-25 period after cargo surveyors reported
declines from a month ago, reinforcing views that stock levels could climb
after falling to a 14-month low in June.
"There is not enough push to go
up after some profit bookings yesterday, so the market is down again
today," said a Singapore-based trader with a foreign commodities
brokerage. "It looks like the trend is still bearish."
Benchmark October palm oil futures on the Bursa Malaysia Derivatives Exchange fell 2.3 percent to close at 2,882
ringgit ($909) per tonne. Prices earlier touched 2,880 ringgit, the lowest
level since June 18.
Traded volume picked up after the
midday break to 27,567 lots of 25 tonnes each, higher than the usual 25,000
lots.
Technicals were bearish, as palm oil
is biased to fall to 2,838 ringgit, Reuters market analyst Wang Tao said, based
on a wave pattern and retracement analysis.
Malaysia's palm oil exports
continued to show weakness from a month ago, falling 14.3 percent and 18.6
percent, according to cargo surveyors Intertek Testing Services and Societe
Generale de Surveillance respectively.
Slowing exports coupled with better
production expected in Malaysia could boost palm oil stock levels, taking some
pressure off tightening global oilseed supplies.
Market players are also looking out
for a return of the El Nino weather pattern to Southeast Asia as the hot and
dry weather could hurt palm oil output from top producers Indonesia and
Malaysia, providing upside for palm oil prices.
Oil prices dropped below $104 a
barrel on Thursday, squeezed by a stronger dollar as disappointing corporate
earnings contributed to a gloomy outlook for demand growth.
Other vegetable oil markets similarly
suffered declines on U.S. wet weather forecasts.
REGIONAL EQUITY- BANGKOK, July 26 (Reuters) - Major Southeast Asian stock markets mostly closed lower on Thursday, led down by commodity-related stocks as a gloomy outlook for demand growth and the euro zone's spreading debt crisis hit oil prices.
Thailand's benchmark SET index fell 1.3 percent to 1,172.92. Malaysian shares ended down 0.7 percent to 1,623.91.
The Philippine index posted a modest 0.18 percent loss. Singapore's Straits Times index bucked the trend, advancing 0.5 percent.
