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While you were sleeping: Wall Street moves higher

While you were sleeping: Wall Street moves higher

Aug 12 (BusinessDesk) - Wall Street advanced as geopolitical concerns eased, allowing investors to shift their attention to better-than-expected US corporate earnings and rising optimism about the outlook for the world’s largest economy.

In late afternoon trading in New York, the Dow Jones Industrial Average gained 0.17 percent, the Standard & Poor’s 500 Index rose 0.33 percent, while the Nasdaq Composite Index advanced 0.67 percent.

Gains in shares of Intel and Caterpillar, both up 1.3 percent most recently, led the Dow higher, outweighing declines in shares of Exxon Mobil and Wal-Mart, down 1 percent and 0.3 percent respectively.

“With the Russia-Ukraine situation, it’s going to be a step-by-step process, hopefully in the right direction,” Veronika Pechlaner, who helps oversee US$2.3 billion at Jersey, Channel Islands-based Ashburton, told Bloomberg News. “What you want to see are no further sanctions, certainly no more military action and potentially some news on the inquiry into the plane that came down.”

Shares of Priceline Group gained, last up 2.9 percent, after the company reported better-than-expected quarterly results and said third-quarter travel bookings may rise as much as 29 percent.

“The summer travel season got off to a solid start for our brands,” Darren Huston, CEO of the Priceline Group, said in a statement.

Shares of Kinder Morgan jumped 10.1 percent after the company announced plans to revamp its businesses.

“This transaction dramatically simplifies the Kinder Morgan story, by transitioning from four separately traded equity securities today to one security going forward,” CEO Richard Kinder said in a statement. “Further, we believe that KMI will be a valuable acquisition currency and have a significantly lower hurdle for accretive investments in new energy infrastructure.”

Meanwhile US Federal Reserve Vice Chairman Stanley Fischer warned a conference sponsored by the Swedish Ministry of Finance in Stockholm, Sweden, that “the global recovery has been disappointing.”

“With few exceptions, growth in the advanced economies has underperformed expectations of growth as economies exited from recession,” Fischer said in prepared remarks. “Year after year we have had to explain from mid-year on why the global growth rate has been lower than predicted as little as two quarters back.”

In the US three key factors have slowed down the pace of recovery, Fischer said: “The unusual weakness of the housing sector during the recovery period, the significant drag—now waning—from fiscal policy, and the negative impact from the growth slowdown abroad—particularly in Europe—are all prominent factors that have constrained the pace of economic activity.”

In Europe, the Stoxx 600 finished the session with a 1.4 percent jump from the previous close. The UK’s FTSE 100 added 1 percent, France’s CAC 40 advanced 1.2 percent, while Germany’s DAX climbed 1.9 percent. For the most part European shares were catching up on Monday to Friday’s rally on Wall Street.

(BusinessDesk)

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