Markets

Midday Update: Bank of Japan Triggers Global Stock Market Rally; Dow Touches Record High

U.S. stocks skyrocketed Friday after the Bank of Japan stunned financial markets by raising its monetary stimulus program by more than 100 trillion yen and the country's massive Government Pension Investment Fund said it will more than double its holdings of foreign investments. Led by gains in component companies Exxon Mobil ( XOM ) and Intel ( INTC ), the Dow Jones Industrial Average today touched a new, all-time high. Strength in chipmakers like Intel and Applied Micro Circuits ( AMCC ) fueled the Nasdaq Composite index to a post-Internet bubble high while the S&P 500 was flirting with its record high after piercing 2,000 for the first time in six weeks.

Upbeat consumer confidence and better-than-expected manufacturing data also were driving equities to record levels. The Chicago Purchasing Managers' Index jumped to a one-year high at 66.2 during October, beating Street estimates looking for no change from the prior month's 60.5 reading. Consumer confidence as measured by Reuters/University of Michigan also improved, reaching a final index reading for October of 86.9 from a preliminary 86.4 reading earlier this month.

Other data today included below-consensus scores for consumer income and spending, rising 0.2 and falling 0.2%, respectively, and lagging consensus estimates expecting a 0.3% rise in income and a 0.1% gain in spending. The Employment cost index rose 0.7% during Q3, topping estimates looking for a 0.5% increase.

Stocks across the globe all closed sharply higher, particularly in Japan where the Nikkei soared by nearly 5%, spilling into Europe where all the major bourses rallied by as much as 2%. Mixed European data including weak German retail sales, French consumer spending and a small uptick in Italian unemployment barely put a dent in sentiment overseas.

Not only were gains in Europe powered by events in Japan, but by the expectation that the European Central Bank will follow the lead of the BOJ now that the U.S. Fed has cut off additional stimulus.

Crude oil was down $0.99 to $80.12 per barrel. Natural gas was up $0.10 to $4.01 per 1 million BTU. Gold was down $33.20 to $1,165.40 an ounce, while silver was down $0.50 to $15.92 an ounce. Copper was down $0.01 to $3.05 per pound.

Among energy ETFs, the United States Oil Fund was down 1.04% to $30.44 with the United States Natural Gas Fund was up 2.39% to $20.53. Amongst precious-metal funds, the Market Vectors Gold Miners ETF was down 4.52% to 17.51 while SPDR Gold Shares were down 2.70% to $112.08. The iShares Silver Trust was down 3.41% to $15.28.

Here's where the U.S. markets stand at mid-day:

NYSE Composite Index up 102.97 (+0.96%) to 10,815.16

Dow Jones Industrial Average up 161.09 (+0.94%) to 17,356.51

S&P 500 up 18.08 (+0.91%) to 2,012.73

Nasdaq Composite Index up 54.27 (+1.19%) to 4,620.41

GLOBAL SENTIMENT

Nikkei 225 Index up 4.83%

Hang Seng Index up 1.25%

Shanghai China Composite Index up 1.22%

FTSE 100 Index up 1.16%

CAC 40 up 2.34%

DAX up 2.24%

NYSE SECTOR INDICES

NYSE Energy Sector Index up 0.72%

NYSE Financial Sector Index up 1.32%

NYSE Healthcare Sector Index up 0.57%

UPSIDE MOVERS

(+) GPRO (+12.85%) Beat Q3 expectations and issued strong Q4 forecast.

(+) MELI (+19.44%) Beat Q3 earnings estimates.

(+) BCOV (+14.38%) Reports better-than-expected Q3 results, sets mixed guidance.

(+) YRCW (+16.76%) Beats Q3 earnings estimates, revenue in-line.

DOWNSIDE MOVERS

(-) AEGR (-39.99%) Reported a Q3 loss and lowered FY14 revenue guidance.

(-) KGC (-14.46%) Gold stocks plummet as gold falls to four-year low.

(-) COMM (-8.13%) Issued a downbeat Q4 forecast.

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

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

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