JP Morgan, Goldman help lift stocks


Strong earnings by JP Morgan, Goldman Sachs, and other companies are keeping stocks positive ahead of testimony by Federal Reserve Chair Janet Yellen later today.

S&P 500 futures are up 0.1 percent after rising for the last hour. Europe is down slightly, with the higher-risk countries of Italy and Spain once again leading the declines. Asia was strong overnight, as Japan, Hong Kong, Seoul, and Mumbai all gained at least 0.5 percent.

The S&P 500 continued its uptrend yesterday as investors reacted to strong earnings from Citigroup and prepare for more quarterly results today. Transportation stocks led the gains and broke out to new highs, which gives the bulls reason to expect more upside from the broader market.

Today's big event is Yellen's appearance on Capitol Hill at 10 a.m. ET. Retail sales and the New York Fed's Empire manufacturing index also come out at 8:30 a.m. ET. Other potentially important economic headlines follow tonight when China reports gross domestic product and industrial production.

But the real focus today is on earnings, with JP Morgan and Goldman Sachs climbing at least 2 percent on better-than-expected results. Dallas-based lender Comerica also surged 8 percent after beating estimates, while footwear maker Wolverine Worldwide gained 6 percent on strong sales and profit. Other important companies including Intel, Yahoo, and CSX follow after the closing bell today. Bank of America and U.S. Bancorp are on deck for tomorrow morning.

Mergers and acquisitions are in the news as well as cigarette company Reynolds American buys Lorillard for $27.4 billion and chemical maker Albemarle gobbles up Rockwood for $6.2 billion. LO, which had already been climbing on deal speculation, is down 5 percent, but ROC is poised for a gain of at least 13 percent on the news.

Gains have been spread across most sectors in recent months, but the biggest trend has been strength in technology as investors look for increased spending on computers and semiconductors. Our researchLAB market scanner also shows strength recently in Latin American banks, basic metals and coal-mining stocks. Housing and utilities have lagged.

Foreign-exchange markets are painting a modestly bullish picture as the safe-haven Japanese yen retreats. Oil fell about 1 percent and copper declined 0.25 percent. Gold and silver are bouncing about half a percent, while agricultural products are lower. 

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

Copyright © 2010 OptionMonster® Holdings, Inc. All Rights Reserved.

This article appears in: Investing , Options

Referenced Stocks: SPX



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