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It is time to stop and smell the roses (or cherry blossoms at least) as we head into the second month of Spring. May starts on a sparkling note with Japan taking the entire week off for the Golden Week holidays and China celebrating the labor movement with a four-day vacation. With China and Japan taking a nice long break, investors will depend on U.S. and Australian economic data to move the markets in the week ahead.
The Bank of Japan left its monetary policy unchanged at a board meeting on Friday, keeping the overnight call rate target at 0.5% as widely expected by financial markets. The decision by the nine-member board was unanimous.
Stocks ended mixed but the Dow closed at another record high as earnings continued to exceed expectations. "We were all expecting some kind of pullback but it's just one of those moves that you can't pinpoint with any single piece of data," said Mike Driscoll, managing director of listed trading at Bear Stearns.
Zachary Karabell, chief economist at Fred Alger Management, told CNBC’s “Closing Bell” that a good way to play the current bull market is to “buy what China is buying on all scores.”
Stocks are set to continue their move upward this morning, after world markets joined the Wall Street buying spree that pushed the Dow above 13,000 for the first time and brought the S&P 500 within striking distance of its 2000 high. Stronger-than-expected earnings continue to set the tone this morning, with reports from Ford, Exxon Mobil and 3M already in and Apple still aglow from yesterday's strong profit report.
The number of U.S. workers filing new claims for jobless benefits fell a much bigger-than-expected 20,000 last week, a Labor Department report showed on Thursday.
The dollar strengthened broadly on Thursday as dealers, frustrated at the euro's failure to reach a fresh new record high against the greenback, bought the U.S. currency back across the board.
When the owners of football teams want the best performance, they hire the best managers. When the team is failing the manager gets sacked.
The Dow ripped through the 13,000 level to close with a 135-point gain spurred by strong earnings reports and positive news from Alcoa. "The momentum in the equities market is looking really good," said Alec Young, market strategist at S&P. "We were expecting earnings growth of about 3% and we've seen double that."
It only took six months for the Dow Jones Industrial Average to rise 1,000 points to a record 13,000. But the way analysts were talking on Wednesday, it may take even less time for the blue-chip average to reach 14,000.
The dollar fell to a two-year low against a basket of major currencies on Wednesday and came within a whisker of its record low against the euro after soft U.S. housing data kept a spotlight on slowing economic growth.
Most parts of the country logged moderate economic growth in the early spring, despite sluggish manufacturing largely due to the housing slump.
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Stocks are set to move higher at the opening, with the Dow heading straight for the 13,000 mark. European shares are higher, as the rising euro closes in on its all-time high against the dollar. Overnight, Asian stocks were lower, with Tokyo stocks falling on worries about the U.S. consumer after yesterday's weak housing data and consumer confidence number. Japanese automakers' shares were dented in the selling.
Japan's trade surplus with the rest of the world grew 73.9% in March, a faster-than-expected increase largely led by strong auto and semiconductor exports, the government said Wednesday.
Strong domestic demand helped South Korea's economy grow 4% on year in the first quarter, steady from the annual growth rate set in the fourth quarter of 2006, meeting analysts expectations.
Stocks rose and the Dow moved closer to 13,000 after IBM announced a $15 billion stock buyback plan, as investors shrugged off disappointing data from the housing industry."With the liquidity out there and risk appetites increasing for investors ... you probably have to give upside the benefit of the doubt here," said Jeff Saut, chief investment strategist at Raymond James.
The dollar slipped after weak U.S. housing and consumer confidence data raised expectations the Federal Reserve may have to cut interest rates sometime this year.
Existing home sales declined 8.4% to 6.12 million units in March from February, sliding more steeply than forecasts, according to the National Association of Realtors. Sales were expected to have dropped to 6.495 million units in March from 6.69 million in February.
Underlying inflation in Australia was surprisingly subdued in the first quarter while consumer prices rose at their slowest pace in two years, radically lessening the risk of a rise in interest rates.
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