Stocks Rise Fueled by Strong European Corporate Earnings and Robust Chinese Data

By Josie Cox 

        Global stocks rose Wednesday, fueled by some robust data out of China's and a fresh batch of strong corporate earnings reports.
        In early trade, the Stoxx Europe 600 rose 0.7%, having fallen slightly in the previous session. In the U.S., futures contracts showed the S&P 500 opening around 0.2% higher. Futures, however, don't always accurately reflect moves after the opening bell.
        One of the biggest gainers in Europe was Societe Generale SA.
        Shares in the French bank added nearly 8% after the lender said that second-quarter net profit jumped 25%, lifted by the performance of its large equity and derivatives trading business and a debt-valuation adjustment.
        Shares in Germany's Beiersdorf AG, the maker of Nivea skin care products, also climbed after the group reported that profit during the first half of the year had been boosted by strong sales in Latin America.
        Shares in Standard Chartered PLC rose after the bank said it would halve its dividend to save capital. The bank posted a sharp fall in first-half net profit, underlining the challenge faced by the new chief executive Bill Winters to get the bank back on track.
        More than half of the constituents of the pan-European index have now reported quarterly results. Of those that have reported, over 58% have beaten analyst expectations, compared with just 37.6%, that have missed, according to FactSet data.
        In Asia on Wednesday, Japan's Nikkei Stock Average rose 0.5% and South Korea's Kospi gained 0.3%. Strategists attributed those moves to the closely watched Caixin Services Purchasing Managers' Index climbing to an 11-month high in July.
        In China, however, the data appeared to provide little confidence. The Shanghai Composite Index closed down 1.7% and the Shenzhen Composite Index fell 1.1%.
        The euro was 0.2% lower against the dollar in early European trade at $1.087.
        The buck rose against both the euro and the yen late Tuesday after Federal Reserve Bank of Atlanta President Dennis Lockhart, who is a voting member on the Fed's monetary-policy committee, raised expectations for an interest rate rise as early as September.
        Deutsche Bank strategist Jim Reid wrote in a note to clients that this shows the Fed's plans for an increase in rates have seemingly not been derailed by the recent commodity rout, concerns over China, "and the general disappointments over the state of the wider global recovery."
        Later in the day, investors will be paying close attention to the release of the latest estimate of the increase in private payrolls compiled by payroll processor Automatic Data Processing Inc. and forecasting firm Moody's Analytics. This will come out ahead of the Bureau of Labor Statistics' employment situation report scheduled for Friday.
        Valentin Marinov, a currency strategist at Credit Agricole said that a strong reading would likely trigger a fresh rally in the dollar, especially against Japan's yen, the Canadian dollar, the euro and the Swiss franc.
        Brent crude was 0.9% higher in early trade at $50.44 per barrel. Gold was 0.3% lower at $1,087.00 per barrel.
        Write to Josie Cox at josie.cox@wsj.com
        (END) Dow Jones Newswires

        August 05, 2015 05:12 ET (09:12 GMT)

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