European stock markets rose today, with Wall Street expected to open higher, following better than expected earnings from U.S. banking giant Citigroup Inc. and General Electric Corp.
European stock markets rose today, with Wall Street expected to open higher, following better than expected earnings from U.S. banking giant Citigroup Inc. and General Electric Corp.
Citigroup, widely considered the most troubled U.S. bank, said its loss per share in the first three months of 2009 was 18 cents, narrower than the 34 cents analysts were predicting. Meanwhile, General Electric reported earnings per share of 26 cents for the same period, again ahead of analysts' expectations of 21 cents per share.
The news helped Wall Street futures reverse earlier losses and stoked some buying in Europe's markets.
Dow futures were up 6 points, or 0.1 percent, at 8,065 while the broader Standard & Poor's 500 futures rose 0.2 point to 861.70.
In Europe, the FTSE 100 index of leading British shares was up 36.78 points, or 0.9 percent, at 4,089.76 while Germany's DAX rose 46.20 points, or 1 percent, to 4,655.66. The CAC-40 in France was 42.68 points, or 1.4 percent, at 3,080.86.
The results, though clearly affected by the recession, reinforced hopes in the markets that the worst of the economic downturn may be over. Such views had enticed some investors back into stock markets in recent weeks. The rise in risk appetite has gained momentum over the last month or so as global equities have rallied from multiyear lows to post their biggest gains in such a short space of time since 1933.
Citigroup's results followed similarly upbeat reports in recent days by JPMorgan Chase & Co., Wells Fargo & Co. and Goldman Sachs Group Inc.
Keith Bowman, an equities analyst at Hargreaves Lansdown stockbrokers in London, said the earnings from Citigroup were greeted with some relief but said investors need more convincing before they can say the banks have recovered.
"Investors will be wanting to see follow-through into the second quarter to be convinced," he said.
Earlier in Asia, Japan's Nikkei 225 stock average added 152.32, or 1.7 percent, to 8,907.58 while Hong Kong's Hang Seng pared gains to close up 18.28 points, or 0.1 percent, at 15,601.27. India's main index advanced 0.7 percent while Australia's benchmark shed its gains to close slightly higher.
Other markets fared worse, though.
Shanghai's stock index, which has soared almost 40 percent this year on hopes government spending and other measures can help protect China's economy from the downturn, slipped 1.2 percent. Analysts pointed to government warnings that financial institutions should guard against risky loans amid a flood of new lending as Beijing rolls out stimulus measures.
Meanwhile, South Korea's Kospi lost 0.6 percent. Taiwan's main stock measure posted the day's steepest losses, losing about 4 percent, after a spectacular run-up in recent weeks.
Oil prices traded modestly lower, with benchmark crude for May delivery off 19 cents at $49.79 a barrel. The contract on Thursday rose 73 cents to settle at $49.98 overnight.
In currencies, the dollar slipped to 99.28 yen from 99.59 yen. The euro was lower at $1.3064 from $1.3194.
