Wall Street up as investors see value

Specialist Jason Hardzewicz, left, and trader Michael Zicchinolfi work on the floor of the New York Stock Exchange. File photo / AP
Specialist Jason Hardzewicz, left, and trader Michael Zicchinolfi work on the floor of the New York Stock Exchange. File photo / AP

Wall Street gained as some investors found value in equities after the recent slide amid optimism about US corporate profits and economic growth.

In afternoon trading in New York, the Standard & Poor's 500 Index rose 0.85 per cent, following yesterday's 2.3 per cent slide, while the Dow Jones Industrial Average gained 0.62 per cent and the Nasdaq Composite Index added 1.05 per cent.

Advances in shares of DuPont, last up 3.8 per cent, and those of American Express, last up 1.8 per cent, led the Dow higher.

"I'm just not seeing anything that's suggesting that the train is off the track," Ethan Anderson, senior portfolio manager at Rehmann Financial in Grand Rapids, Michigan, told Bloomberg News. "I'm right now in the buying opportunity camp."

Shares of Michael Kors jumped, last up 18 per cent, after the company beat expectations for third-quarter profit.

"Michael Kors enjoyed an outstanding holiday season, as global brand awareness continued to drive strong demand for our luxury product," John Idol, the company's CEO, said in a statement. "Looking ahead, we remain confident that Michael Kors' distinctive positioning in the global luxury market will enable us to achieve strong long term growth for our shareholders."

Meanwhile, Microsoft said it named Satya Nadella as its next chief executive officer, effective immediately. Shares were last 0.3 per cent stronger.

"It's a relief this process is over," Daniel Ives, an analyst at FBR Capital Markets, told Reuters. "Many investors view it as the 'safe pick' as Mr. Nadella is a born-and-bred Redmond insider. But the uphill battle continues for Microsoft on its path to growth."

Microsoft also said Bill Gates will step down as chairman. Instead, Gates "will devote more time to the company, supporting Nadella in shaping technology and product direction." John Thompson will assume the role of chairman.

US factory orders fell 1.5 per cent in December, according to Commerce Department data. It was the biggest decline since July, though smaller than economists had expected. November's were revised to show a 1.5 per cent gain, down from the 1.8 per cent rise previously reported.

In Europe, the Stoxx 600 Index finished the session with a 0.2 per cent decline from the previous close. The UK's FTSE 100 fell 0.3 per cent, while Germany's DAX dropped 0.6 per cent. France's CAC 40 gained 0.2 per cent.

Shares of UBS climbed, closing with a gain of 5.4 per cent in Europe, after Switzerland's biggest bank reported earnings that surpassed expectations.

UBS Chief Executive Officer Sergio Ermotti told Bloomberg that the sell-off in emerging market assets was "a little bit overdone."

"What we are seeing right now is a lot of money exiting the emerging markets," Ermotti said. "Short term, it looks a little bit overdone."

- BusinessDesk

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