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U.S. stocks rise on upbeat earnings, Netflix; Dow Jones up 0.10%

Published 01/27/2011, 09:56 AM
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Investing.com – U.S. stocks were up after the open on Thursday, as strong corporate earnings reports outweighed disappointing data on initial jobless claims.

During early U.S. trade, the Dow Jones Industrial Average was up 0.10%, the S&P 500 index climbed 0.19%, while the Nasdaq Composite index jumped 0.58%.

Earlier in the day, U.S. Department of Labor said that the number of people who filed for unemployment assistance in the U.S. last week rose more-than-expected, climbing to a seasonally adjusted 454K, much more than the expected increase to 408K.

Meanwhile, shares in online video-subscription giant Netflix soared 12.72% after it said fourth quarter profit surged by 52% to USD47 million. Revenue in the quarter jumped by 34% to USD596 million, as its subscribers surpassed 20 million.

The world’s largest maker of mobile phone chips Qualcomm saw shares climb 4.45% after it reported a 39% jump in first quarter earnings to USD1.17 billion. Revenue in the quarter grew by 25% to USD3.35 billion, exceeding market expectations for revenue of USD3.2 billion.

Elsewhere, shares in industrial machinery maker Caterpillar added 1.09% after it said that fourth quarter profit soared by 76% to USD968 million. Revenue in the quarter jumped by 62% to USD12.81 billion, beating market expectations of USD11.72 billion.    

Meanwhile, shares in warehouse operator ProLogis rallied 10.82% amid reports that the company was nearing a merger with rival AMB Property. Shares in AMB soared 8.79% following the news.

However, the largest U.S. telecommunications company AT&T saw shares drop 2.58% after it said that fourth quarter profit plunged by 60% to USD1.1 billion, compared to USD2.7 billion a year earlier, as its subscribers growth was weaker-than-expected.

The world’s largest cell phone maker Nokia saw shares slump 1.58% after it posted a 16% drop in fourth quarter net profit to USD1.02 billion. The company also cut its earnings outlook for the first quarter of 2011, citing “rising competition” in the smart-phone market.

Also Thursday, shares in the world’s largest coffee chain Starbucks fell 1.75% after it warned that rising commodity prices were likely to weigh on earnings in 2011.   

Shares in consumer-products giant Procter & Gamble dropped 2.81% after its second quarter profit declined to USD3.33 billion, compared to USD4.66 billion a year earlier. Sales in the quarter climbed 2% to USD21.34 billion, falling short of analysts’ expectations for sales of USD21.51 billion.

Across the Atlantic, European stock markets were broadly higher. The EURO STOXX 50 climbed 0.73%, France’s CAC 40 added 0.33%, Germany's DAX gained 0.48%, while Britain's FTSE 100 edged up 0.09%.

Earlier in the day, official data showed that U.S. core durable goods orders rose less-than-expected in December, while durable goods orders, which include transportation items, tumbled unexpectedly in December.

Also Thursday, ratings agency Standard & Poor’s cut Japan’s sovereign debt rating to AA- from AA, warning that the country’s fiscal deficits would remain high in the next few years.


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