By ELAINE KURTENBACH
BANGKOK (AP) – Stocks were mixed in Asia on Thursday as the company’s latest earnings report sent investors into a buying mood, fueling gains on Wall Street.
Markets in China remained closed for the Lunar New Year holidays. Tokyo’s Nikkei 225 index lost 1.1% to 27,244.12 while the S&P/ASX 200 gained 0.3% to 7,066.00. Seoul’s Kospi rose 2.1% to 2,718.04, catching up with earlier gains elsewhere after markets in South Korea reopened after the holiday. Singapore’s benchmark also increased by more than 2%.
US futures fell, with the S&P 500 contract down 0.9%. That for the Dow industry fell less than 0.1%.
Investors are looking at the company’s latest earnings round to gauge the damage that rising costs have had on various industries and how the companies will deal with future inflation.
Most of the companies that reported results for the final three months of 2021 delivered the highest profit and revenue forecasts, although they faced higher costs due to rising inflation.
But Facebook’s parent company Meta Platforms fell 22.9% in after-hours trading after its latest quarterly earnings fell short of Wall Street estimates. That has rattled investors in Asia, analysts say.
Meanwhile, oil prices fell after major oil producing countries decided to keep their plans to supply a little more oil to the global economy. That will likely keep prices near a seven-year high. The 23-member OPEC+ alliance chose to add an extra 400,000 barrels per day in March.
Benchmark US crude lost 39 cents to $87.87 a barrel in electronic trading on the New York Mercantile Exchange. It rose 6 cents to $88.26 a barrel on Wednesday.
Brent crude, the basis for international oil pricing, lost 23% to $89.24 a barrel.
On Wednesday on Wall Street, the S&P 500 rose 0.9 percent to 4,589.38. The Dow Jones Industrial Average rose 0.6% to 35,629.33 and the Nasdaq gained 0.5% to 14,417.55. Indices are on a solid uptrend this week.
Shares of small companies have resisted the broader market’s recovery. The Russell 2000 index fell 1% to 2,029.52.
Traders who bid on shares of several companies reported solid quarterly results, helping to lift the broader market. Alphabet, Google’s parent company, jumped 7.5% for the biggest gain in the S&P 500 after the company said its digital ad business drove profits up 36% last quarter. Chipmaker Advanced Micro Devices rose 5.1% after reporting surprisingly strong Q4 financial results and providing encouraging sales forecasts for investors.
About three-quarters of the companies in the benchmark S&P 500 index rose, led by technology and media services stocks. Healthcare companies also account for a large share of profits. Large retailers and other companies that rely directly on consumer spending have fallen. Amazon fell 0.4% and Gap fell 3.3%.
Bond yields fell. The yield on the 10-year Treasury note fell to 1.77% from 1.80% late Tuesday.
Markets are facing a variety of threats including rising inflation, the prospect of higher interest rates, potential conflict in Ukraine and COVID-19 further hampering the economic recovery.
Rising costs are threatening profit margins and putting pressure on consumer spending. The Federal Reserve plans to raise interest rates to try to cool inflation, which is at a four-decade high. Investors expect the first rate hike in March and at least three more in 2022.
With about 40% of S&P companies reporting quarterly results so far this earnings season, about 64% have posted earnings and revenue topping analyst estimates, according to S&P Global Market Intelligence.
Some have fallen short of Wall Street’s expectations.
PayPal fell 24.6%, its worst trading day since splitting from eBay in 2015, after reporting a weak quarter and volatile guidance.
In other trades, the US dollar was flat at 114.43 Japanese yen. The euro was unchanged at $1.1306.
https://www.sbsun.com/2022/02/02/asian-shares-mixed-as-earnings-fuel-gains-on-wall-street/ Asian shares mixed as earnings boost Wall Street – San Bernardino Sun