Solid corporate earnings drive US markets higher

US stocks surged higher as a raft of corporate earnings results came in ahead of expectations.

The Dow Jones closed 0.69 per cent higher, the S&P 500 gained 1.2 per cent and the Nasdaq surged 1.59 per cent.

In company news, Spotify rallied 11.4 per cent after it delivered better than expected earnings and upgraded guidance going forward. UPS & GE Aerospace both delivered better than expected results closing 2.4 per cent & 8.3 per cent respectively. PepsiCo closed 2.9 per cent lower after reporting that recalls and a weaker lower-income consumer hurt demand in the U.S.

Tesla reported results after the bell. Tesla reported a 9 per cent revenue drop, its steepest decline since 2012. Despite challenges, Tesla plans to launch more affordable models and optimise existing production lines to achieve growth targets.

Meta Platforms will report on Wednesday afternoon. Google parent company Alphabet and Microsoft round out the technology-heavy earnings week on Thursday.

Roughly 20 per cent of the S&P 500 has reported earnings through Tuesday. Of those companies, 76 per cent have beaten analysts’ expectations, FactSet data shows.

Elsewhere, the Treasury yields pulled back after U.S. manufacturing data hit a four-month low. The S&P Global Flash U.S. manufacturing PMI read 49.9, down from 51.9 in March.

Turning to US sectors, all closed higher overnight except for Materials, which closed 0.84 per cent lower. Communications was the best performer.

Shifting to European markets, the FTSE 100 marked its second record close in a row, hitting a new high of 8,044.81. The benchmark Stoxx 600 index ended the session up by 1.1 per cent.
Germany’s DAX index led major bourses with a 1.6 per cent gain, while France’s CAC 40 rose 0.8 per cent.

Turning to Asia-related news, Chinese speculators driving gold prices to record highs signal a growing influence of Asian traders over Western counterparts, with long positions on the Shanghai Futures Exchange surging by almost 50 per cent since September, reaching a record high of 324,857 contracts this month amid escalating geopolitical tensions in the Middle East.

Turning to the Australian landscape, Australia’s March quarter inflation figures at 11.30am are the main focus for traders today – the market is fully priced for the Reserve Bank to start easing, but not before 2025.

Futures

The SPI futures are pointing to a 0.3 per cent gain.

Currency

One Australian dollar at 7.30am was buying 64.86 US cents.

Commodities

Gold has lost 0.18 per cent. Silver has gained 0.43 per cent. Copper has fallen 1.02 per cent. Oil is up 1.78 per cent.

Figures around the globe

European markets closed higher. London’s FTSE added 0.26 per cent, Frankfurt gained 1.55 per cent, and Paris closed 0.81 per cent higher.

Turning to Asian markets, Tokyo’s Nikkei added 0.30 per cent, Hong Kong’s Hang Seng gained 1.92 per cent and China’s Shanghai Composite closed 0.74 per cent lower.

The Australian share market closed 0.45 per cent higher at 7,683.51.

Ex-dividends
Steamships Trading (ASX:SST) is paying 21.0386 cents unfranked

Dividends payable
360 Capital REIT (ASX:TOT)
Australian Unity Office Fund (ASX:AOF)
Ridley Corp Ltd (ASX:RIC)

Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap.

Disclaimer

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