The S&P 500 climbed to another five-year high today, as Wall Street was spurred by data showing stronger-than-expected exports out of China. Export growth hit a seventh-month high in the world's #2 economy, surprising investors after seven straight quarters of decline. The Dow Jones Industrial Index followed north, with gains of 81 points, or 0.6%.
Initial unemployment claims were roughly in line with expectations at 371,000 last week, while November wholesale inventories grew faster than expected, which could lead to increased growth in the economy.
The usual suspects led the Dow today, as Bank of America gained 3.1% after falling on yesterday's downgrade from Credit Suisse. U.S. District Attorney Preet Bharara also announced his intent to prosecute the bank for fraud, even after this week's settlement with Fannie Mae. Investors seem to have bid up the stock, in part, on hopes for its earnings report next Thursday. Wells Fargo will be the first major bank to report earnings when it releases tomorrow.
Hewlett-Packard also jumped 2.7% despite a report showing that PC sales fell by 6.4% in the fourth quarter, worse than the 4.4% decline the market expected. That was the first drop in five years, but HP did retain a slight edge in market share, with 17% of the market, topping Lenovo by 1%. Still, several analysts see HP as having greater value in a potential breakup, and shares have been on fire since its latest earnings report.
Elsewhere, American Express said it would lay off about 5,400 employees, mostly in its travel division, and take a $600 million after-tax charge in Q4, cutting its profits in half for the reporting period. The charges stem from restructuring, rewards being redeemed at a faster rate than expected, and some customer reimbursements. After the charges, the company expects EPS of $0.56, or $1.09 without them. Wall Street seemed to take the news in stride as the stock actually gained 0.9% on the day.
Chevron also reported its Q4 earnings would be better than expected, as oil and gas output improved, and the company booked a gain of $1.4 billion on an asset transaction. The energy company's refinery in Richmond, CA, which had experienced a fire, will also come back on line this quarter. Global output also reached its highest level since mid-2011; shares jumped nearly 1% after hours when the news was released.
Shares of Wal-Mart were also down 0.3%, after lawmakers released emails that revealed that executives were aware of the bribery scandal at its Mexican subsidiary as early as 2005. The Congressional investigation could lead to fines and other legal action.
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