US equities are set to follow European and Asian indicies higher today as positive economic data was released.
After the Federal Reserve's initial estimate of a 0.1% contraction in the US economy, fourth quarter GDP was revised upward to show a 0.1% growth. This falls short of economists' estimates of 0.5%, reflecting positive surprises in backward-looking economic data. Weekly jobless claims also brightened. Initial claims last week fell by 22,000 to 344,000. Continuing claims unexpectedly dropped to 3.074 million from 3.165 million.
After reaching fresh post-crisis highs yesterday, Dow
(INDEXDJX:.DJI) futures are up 0.04% at 14,067. Futures contracts on the S&P 500
(INDEXSP:.INX) rose 0.8% to 1,517.00 and Nasdaq
(INDEXNASDAQ:.IXIC) futures climbed 0.09% to 2,743.00. Asian and European equities also made gains today.
Later this morning, Chicago PMI for February will come out. The index is expected to fall 16 points to 54, showing that the expansion in the region is slowing.
While the markets rose after hours, there were some consumer-facing losers. JC Penney
(NYSE:JCP) shares fell nearly 15% after the company reported a major loss for the holiday quarter. Same store sales fell 31.7%. Internet sales, which are increasing industry-wide, fell 34.4%. Overall, revenue was down 28.4% and the company lost $2.51 per share versus an estimated loss of $0.24. Since former Apple
(NASDAQ:AAPL) retail head Ron Johnson took the helm a year ago, the stock fell 56.5%. JC Penney gave analysts no guidance for the current period.
(NASDAQ:GRPN) also took a dive. The company lost over a quarter of its value since reporting earnings yesterday afternoon. Over the holiday quarter, the company took a smaller cut of daily deals. This generated 30% more revenue than the year before, but resulted in a penny-per-share loss, versus a projected $0.03 per share profit. Groupon's sales outlook also missed consensus estimates.
Japan sent a clear message that it intends to step up monetary stimulus with a pick for Bank of Japan governor. Today, Prime Minister Shinzo Abe officially nominated Haruhiko Kuroda to lead the central bank. The former Asian Development Bank president favors unconventional monetary policy, and says that Japan can hit its 2% inflation goal in two years. The Nikkei
(INDEXNIKKEI:.NI225) stock index rallied 2.71% overnight.
Consumer prices in the eurozone dipped to 2% in January from 2.2% in December 2012. This meets expectations and nearly hit European Central Bank projections. ECB chief Mario Draghi says that CPI could fall below 2%.
Today, European Union leaders introduced the world's strictest caps on bankers' bonuses. Bankers in financial hubs like London will not be able to earn more than a year's salary in the form of a bonus. Despite the City's protests, the UK cannot veto this plan.
German unemployment fell by 3,000 in February to 2.9 million, a smaller drop than expected. Spanish fourth quarter GDP fell 0.8%. Spain will miss its deficit reduction target this year. The deficit will fall by 6.7%, versus the target of 8.9%
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