Indian ADRs end higher led by banking ADRs
U.S. stocks rallied to their best day of the year on Tuesday, 14 January 2014 as investors welcomed stronger-than-expected retail sales, got a boost from big technology stocks and absorbed earnings results from financial bellwethers. A batch of economic data released on Tuesday comforted those who are betting on stronger growth.
The Dow Jones Industrial Average rose 115.92 points, or 0.7% to 16,373.86. The Nasdaq Composite gained 69.71 points, or 1.7% to 4,183.02. The S&P 500 closed 19.68 points, or 1.1%, higher at 1,838.88. The technology sector led broad-based gains.
All ten sectors ended higher. The tech sector rallied thanks to all-around support from its components. Top-weighted members like Apple, Google, Microsoft and Oracle added between 1.2% and 2.4% while chipmakers displayed strength as well.
J.P. Morgan Chase rose as high as 1% but gave up nearly all of its gains by the end of the day. Earnings topped expectations, though investment-banking revenue and mortgage origination slumped. Wells Fargo shares ended the day near flat after fourth-quarter earnings were broadly in line with analysts' expectations.
Shares of Google climbed 2.4% after the technology company said late Monday that it was buying Nest Labs, a home-automation company, for $3.2 billion.
Trading activity was uneventful in Asia and Europe on Tuesday, and not much more active in the U.S. session. A heavy slate of U.S. economic data was released Tuesday, including a retail sales report that was a bit better than expected, which limited buying interest in the precious metals.
Today's economic data at Wall Street was limited to a pair of reports. Retail sales increased 0.2% in December after rising a downwardly revised 0.4% (from 0.7%) in November. The consensus expected no change in the December reading. Given the weak jobs report and the corresponding decline in aggregate wages, there was real potential for a dismal retail sales report.
Also, Business inventories increased 0.4% in November, down from an upwardly revised 0.8% (from 0.7%) in October. The consensus expected business inventories to increase 0.3%. Total inventories consist of manufacturers, merchant wholesalers, and retailers. Both manufacturers (0.0%) and merchant wholesaler (0.5%) inventories were announced prior to the total inventory release. The only unknown was retailer inventories, which increased 0.8% in November after increasing 1.1% in October.
In overnight news, European Union industrial production was reported at up 1.8% in November from October and up 3.0% year on year. That's the best reading in over three years. This continues an impressive trend of better economic data coming out of the Euro zone.
Crude Oil futures closed back above $92 a barrel on Tuesday, 14 January 2014 at Nymex buoyed by expectations for a weekly decline in U.S. crude supplies as a rise in retail sales helped lift the energy-demand outlook. Crude oil for February delivery added 79 cents, or 0.9%, to settle at $92.59 a barrel on the New York Mercantile Exchange.
Market expects a decline of 1.6 million barrels in crude stockpiles for the week ended Jan. 10. They expect gasoline inventories to climb by 1.7 million barrels and forecast an increase of 1.3 million barrels for distillates, which include heating oil.
Bullion prices ended lower on Tuesday, 14 January 2014 at Comex. Gold futures settled lower on Tuesday with strength in U.S. equities, a rise in retail sales and comments from Federal Reserve officials pointing to the prospects of further tapering of the central bank's bond-buying program fueling the metal's first loss in four sessions.
Gold for February delivery lost $5.70, or 0.5%, to settle at $1,245.40 an ounce on the Comex division of the New York Mercantile Exchange. Prices tallied a gain of roughly 2% over the past three trading sessions and closed at a four-week high on Monday. March silver traded on Comex also retreated Tuesday, shedding 10 cents, or 0.5%, to $20.28 an ounce.
Indian ADRs ended higher on Monday. In the banking space, ICICI Bank rose 1.14% at $36.41 and HDFC Bank added 1.07% at $34.09. In the IT space, Wipro gained 0.39% at $12.86 and Infosys was down 0.15% at $59.41. In the other sectors, Tata Motors was up 0.79% at $30.57 and Dr Reddy's Laboratories gained 1.03% at $43.10.
Tomorrow, the weekly MBA Mortgage Index will be released at 7:00 ET while December PPI and the January Empire Manufacturing survey will both be reported at 8:30 ET. The day's data will be topped off with the 14:00 ET release of the Federal Reserve's Beige Book for January.
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