Federal Reserve Vice Chairwoman Janet Yellen's cautious
comments caused markets to breathe a sigh of relief as she
suggested that the US still had a long way to go before the bank
begins to taper its stimulus spending.
Yellen said the US economy was still underperforming and that
the US central bank still has "more work to do." Her comments
sent US share markets as well as Asian stocks soaring and put
pressure on the dollar. Many believe that she could change the
Fed's current threshold for the jobless rate from 6.5 percent to
six percent or below.
On Thursday, Yellen will appear before the Senate for a
confirmation hearing to become the next Federal Reserve
In other news around the markets:
GDP data from Japan showed the nation's economy slowed down,
but less than expected in the third quarter. The figures showed a
0.5 percent expansion from July to September, lower than the 0.9
percent growth seen in the second quarter, but higher than
analysts had predicted.
Cisco Systems said the US government's spying scandal is
having a negative impact on the company's revenue. The company
said its revenue could fall up to 10 percent this quarter, and
continue to fall until mid 2014. In emerging markets like China,
Cisco saw a massive drop in sales after Edward Snowden leaked
information about US surveillance, most of which took place
through internet data.
Both Germany and France reported worse than expected GDP data
in the third quarter, which added to evidence that the bloc's
recovery was wobbly. German GDP increased by just 0.3 percent
from July to September, significantly less than the 0.7 percent
growth the nation saw in the second quarter. The French economy
contracted 0.1 percent unexpectedly, after expanding 0.5 percent
in the second quarter.
Two of the eurozone's nationalist leaders have formed an
alliance to help their anti-euro, anti-immigration movement gain
momentum. France's Marine Le Pen and the Netherlands' Geert
Wilders have joined forces ahead of spring elections and are
working to rope in other nationalist parties from Austria and the
Asian markets were on a high with the Japanese NIKKEI up 2.12
percent and Indonesia's JSX composite up 1.52 percent. China's
Shanghai composite rose 0.60 percent and the Shenzhen composite
was up 0.99 percent.
European markets were also higher with the UK's FTSE up 0.82
percent and the eurozone's STOXX 600 up 0.60 percent. The German
DAX gained 0.81 percent and France's CAC 40 rose 0.75
Energy futures were mixed with Brent futures up 0.39 percent
but WTI futures down 0.17 percent. Precious metals were higher
with gold up 1.15 percent and silver up 1.46 percent. Industrial
metals were mixed with aluminum down 0.28 percent and tin up 0.55
The euro lost 0.38 percent against the dollar and the pound
fell 0.30 percent against the dollar. The dollar gained 0.75
percent against the yen and 0.69 percent against the Australian
Notable earnings released on Wednesday included:
Cisco Systems, Inc. (NASDAQ:
) reported first quarter EPS of $0.53 on revenue of $12.09
billion, compared to last year's EPS of $0.48 on revenue of
Macy's Inc. (NYSE:
) reported third quarter EPS of $0.47 on revenue of $6.28
billion, compared to last year's EPS of $0.36 on revenue of $6.08
NetApp, Inc. (NASDAQ:
) reported third quarter EPS of $0.66 on revenue of $1.55
billion, compared to last year's EPS of $0.51 on revenue of $1.54
Stocks moving in the Premarket included:
Johnson & Johnson (NYSE:
) gained 0.17 percent in premarket trade after ending the day on
Wednesday with at 0.24 percent loss.
Morgan Stanley (NYSE:
) rose 0.17 percent in premarket trade after gaining 3.16 percent
over the past week.
General Motors (NYSE:
) gained 0.13 percent in premarket trade after jumping 4.86
percent on Wednesday.
) lost 2.04 percent in premarket trade after rising 3.44 percent
over the past week.
Earnings reports expected on Thursday include:
Wal-Mart Stores, Inc. (NYSE:
) is expected to report third quarter EPS of $1.13 on revenue of
$116.75 billion, compared to last year's EPS of $1.08 on revenue
of $113.93 billion.
Kohl's Corporation (NYSE:
) is expected to report third quarter EPS of $0.86 on revenue of
$4.55 billion, compared to last year's EPS of $0.91 on revenue of
Nordstrom, Inc. (NYSE:
) is expected to report third quarter EPS of $0.66 on revenue of
$2.87 billion, compared to last year's EPS of $0.71 on revenue of
US data will dominate Thursday's economic calendar with the
nation releasing oil inventory data, initial and continuing
jobless claims and retail sales. European releases will include
eurozone GDP, British retail sales and the ECB's monthly
For a recap of Wednesday's market action click .
Tune into Benzinga's pre-market info show with Dennis Dick and
(c) 2013 Benzinga.com. Benzinga does not provide investment
advice. All rights reserved.
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