Apple climbed 4,9% to USD 425,95 in after closing trade yesterday night after reporting strong second quarter earnings. Apple also unveiled plans to double the amount of capital returned to shareholders after for a long time being heavily criticized for not sharing excessive profits. The Apple quarterly report made stock markets in Asia to rally. Wall Street recovered Tuesday after initial sharp declines sparked by an Associated Press tweet about explosions in the White House.
The false tweet by hackers of two explosions at the White House that injured US President Barack Obama, provoked a steep drop in stocks. The benchmark S&P index fell 16,6 points or close to one percent in 3 minutes. Index values of USD 136 billion were wiped out. Stocks quickly recovered minutes later. The tweet episode illustrates the advantages, but simultaneously the fall outs of an instantaneous pricing technology.
Asian shares advanced on Wednesday on the back of Apple and other solid US quarterly earnings. The Euro came under pressure by soft German data which underscored the fragile state of the euro zone economy. The Asia-Pacific MSCI-index climbed 0,8%. The Australian stock index gained 1.4% along with a firmer Aussie dollar. The positive US numbers also gave a lift to oil and other commodities. Copper is up after several day’s decline. Brent crude trades at USD 100,54 a barrel. Gold (USD 1426) and silver (USD 23,15) prices are up after falling back during yesterday’s trading.
The more positive tone in global equities markets seem to indicate that investors regard continued monetary easing by major central banks as justified. Monetary easing encourages investments in shares. But that also means that stock markets don’t reflect the real economic fundamentals. Equities continue to rally in spite of sluggish manufacturing surveys and weaker economic data from both the US and China, the two major engines in the global economy.
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