Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


While you were sleeping: US manufacturing lifts mood

While you were sleeping: US manufacturing lifts mood

By Margreet Dietz

Oct. 3 (BusinessDesk) - US stocks and the dollar gained, with the Dow and S&P 500 climbing to records, as reports of better-than-expected manufacturing activity bolstered optimism about the outlook for the economy and corporate profits.

“You’ve seen a pretty healthy first half of the year with earnings, when we (are) headed into Q3, there is a sense of optimism that you can see upfront,” Nadia Lovell, US Equity Strategist, JP Morgan Private Bank, told Reuters.

Third-quarter earnings are expected to increase 6.2 percent from a year earlier, according to Reuters.

In 1.37pm trading in New York, the Dow rose 0.54 percent, while the Nasdaq Composite Index gained 0.15 percent. In 1.22pm trading, the Standard & Poor’s 500 Index advanced 0.28 percent.

The Dow touched a record high 22,538.20, while the S&P 500 climbed to a record 2,527.96.

An Institute for Supply Management report showed its index of US national factory activity climbed to 60.8 in September, the highest reading in 13 years and up from 58.8 in August.

“Much of the gain is presumably linked to the aftereffects of the hurricanes. Nonetheless, manufacturing growth is strong,” John Ryding, chief economist at RDQ Economics in New York, told Reuters.

The Dow moved higher as gains in shares of Intel and those of Walt Disney, recently up 2 percent and 1.5 percent respectively, outweighed declines in shares of Apple and those of Exxon Mobil, recently 0.6 percent and 0.4 percent weaker respectively.

The VIX, or the Chicago Board Options Exchange Volatility Index which measures expectations of future volatility in stocks, slipped 0.1 percent to 9.50.

Shares of Metro fell after the Canadian grocer said it plans to sell assets and is committed to maintaining its BBB credit rating as it agreed to buy Jean Coutu Group, a pharmacy chain, for about C$4.5 billion (US$3.6 billion).

Under the terms of the deal, Metro agreed to pay C$24.50 a share in cash and stock for Jean Coutu, the companies said in a joint statement.

Asset sales under consideration include unloading the 32.2 million shares Metro owns in Alimentation Couche-Tard, the owner of the Circle K convenience-store chain, Bloomberg reported.

“We’re not under pressure, there’s no critical timing, we will do this in an orderly fashion to make sure we maximize proceeds,” Metro Chief Financial Officer Francois Thibault said on a conference call, commenting on Couche-Tard, according to Bloomberg.

The company forecasts a debt to earnings ratio below 3 if it sells its entire stake in Couche-Tard, Bloomberg reported, citing Thibault. The goal is to decrease the ratio to 2.5 percent over the next couple of years, he said.

Shares of Metro traded 1.4 percent weaker as of 1.17pm in Toronto, while those of Jean Coutu Group traded 1.7 percent stronger at C$24.70.

In Europe, the Stoxx 600 Index finished the day with a 0.3 percent gain from the previous close. France’s CAC 40 Index rose 0.4 percent, Germany’s DAX Index increased 0.6 percent, while the UK’s FTSE 100 Index climbed 0.9 percent.



© Scoop Media

Business Headlines | Sci-Tech Headlines


Commerce Commission: Warns Genesis Over Business Billing Errors

The Commerce Commission has issued a warning to Genesis Energy Limited about billing errors concerning electricity line charges to business customers. Genesis reported the errors to the Commission. The Commission considers that Genesis is likely to ... More>>

QV: Tax Changes Yet To Dampen Red-Hot Housing Market

Just over a month has passed since the Government announced measures aimed at dampening the rampant growth of the property market, and yet the latest QV House Price Index data shows the market hit a new high in April. The average value increased 8.9% nationally ... More>>

Stats NZ: Consents For New Homes At All-Time High

A record 41,028 new homes have been consented in the year ended March 2021, Stats NZ said today. The previous record for the annual number of new homes consented was 40,025 in the year ended February 1974. “Within 10 years the number of new homes ... More>>

The Conversation: The Outlook For Coral Reefs Remains Grim Unless We Cut Emissions Fast — New Research

A study of 183 coral reefs worldwide quantified the impacts of ocean warming and acidification on reef growth rates. Even under the lowest emissions scenarios, the future of reefs is not bright. More>>

The Conversation: Why Now Would Be A Good Time For The Reserve Bank Of New Zealand To Publish Stress Test Results For Individual Banks

Set against the backdrop of an economy healing from 2020’s annus horribilis , this week’s Financial Stability Report (FSR) from the Reserve Bank (RBNZ) was cautiously reassuring: the country’s financial system is sound, though vulnerabilities remain. More>>

Reserve Bank: Concerned About New Zealand's Rising House Prices

New Zealand house prices have risen significantly in the past 12 months. This has raised concerns at the Reserve Bank of New Zealand – Te Putea Matua about the risk this poses to financial stability. Central banks responded swiftly to the global ... More>>