Global stocks have spiraled downwards amid lingering concerns over Greece going bankrupt and the prospect of the first rise in US interest rates in almost a decade.
In Europe shares across the board fell, despite the European Central Bank’s new bond-buying campaign continuing to push down the euro and the bloc’s already record-low borrowing costs, Euronews reported.
London’s FTSE, Britain’s top share index, suffered its biggest decline so far this year, hit by falls in insurer Prudential and energy stocks such as BG. The FTSE closing down 2.5 percent at 6,702.84 points. Commodities struggled while oil prices dropped to near one-month lows as oversupply and weak demand pushed Brent crude oil futures down.
US Stocks Climb
US stocks rose, after the biggest equities selloff in more than two months amid the surging dollar, as banks and semiconductor companies rebounded.
Intel Corp. rallied 3.7 percent and Micron Technology Inc. advanced 1.9 percent. Citigroup Inc. and Bank of America Corp. rose 1.3 percent. Financial stocks in the Standard & Poor’s 500 Index Tuesday had their steepest declines since April, while chip makers fell lost the most in almost six weeks.
The S&P 500 Index climbed 0.2 percent to 2,048.18 at 10:13 a.m. in New York. The Dow Jones Industrial Average added 47.10 points, or 0.3 percent, to 17,710.04. The Nasdaq Composite Index rose 0.2 percent.
Yields on 10-year Treasuries were higher after falling in the previous two days as the European Central Bank’s sovereign-bond buying sent the region’s debt yields to record lows, underscoring the relative value of US debt.
Profit Drops
A 10 percent strengthening in the trade-weighted dollar lowers the estimated 2015 profit for the S&P 500 by about $3 a share, according to an earnings model created by Goldman Sachs Group Inc. The benchmark equity gauge will have earnings per share of $123.52 this year, according to the average of 20 strategist forecasts compiled by Bloomberg.
Analysts predict profit at S&P 500 companies will drop 5.1 percent in the current quarter after a 4.4 percent increase in the final three months of 2014, data compiled by Bloomberg show. Should S&P 500 earnings fall for the first three months of 2015, it would mark the first period of negative earnings since 2009.
Dollar General Corp. and Oracle Corp. are among the final companies to post quarterly results over the next week as the earnings season comes to a close. Around 74 percent of companies that have already reported beat profit projections, while 56 percent topped sales estimates.
