U.S. stocks move higher on earnings
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-- ECB lays out QE plans
-- Euro, German bond yields edge lower
U.S. stocks rose Thursday after several companies reported upbeat earnings and European Central Bank officials unveiled plans to scale down but extend their bond-buying program.
Corporate results continued to drive swings in individual U.S. stocks in one of the busiest days for third-quarter reports. Without geopolitical developments or major legislative changes in Washington, D.C., money managers say they are closely following earnings season.
"We're really focused on earnings, which have been pretty strong and consistent across the board in many sectors," said Jennifer Ellison, a principal with Bingham Osborn & Scarborough, a San Francisco-based investment firm with $4.2 billion in assets under management. "The market has some momentum and that can continue with more good news out of [upcoming] economic data."
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The Dow Jones Industrial Average added 75 points, or 0.3%, to 23404, recouping some of the losses suffered Wednesday. The S&P 500 rose 0.1%, while the Nasdaq Composite fell less than 0.1%.
DowDuPont, one of the biggest gainers in the Dow Jones Industrial Average, rose 3.1% after it gave investors an early look into its sales and profit results, the first window into the global chemical giant following the combination of Dow Chemical and DuPont.
Ford Motor added 1.4% after the auto maker said third-quarter profit rose amid strong sales of its F-Series trucks, a lower tax rate and cost-cutting efforts.
Twitter reported a narrower loss and raised its earnings forecast for the fourth quarter, but also said it overstated its number of users for the past three years. Twitter shares surged 18%, its largest percentage increase in more than a year.
In Europe, stocks gained momentum while the euro and bond yields edged lower after the ECB said it would pare back its monthly bond purchases to EUR30 billion a month from EUR60 billion and keep buying until the end of September next year. The ECB also reiterated that interest rates would remain at their current levels well past the end of the asset-purchase program.
The ECB's move was closely in line with what investors and economists had forecast. Still, many took the development and ECB President Mario Draghi's tone during his news conference as a confirmation that eurozone monetary policy would remain ultraloose for some time to come.
The Euro Stoxx 50 index of eurozone stocks gained 1.3%, while the euro fell 1.3% against the U.S. dollar to $1.1664.
As the euro weakened, the Wall Street Journal Dollar Index, which measures the U.S. currency against a basket of 16 others, rose 0.7%.
Yields on German 10-year bonds fell to 0.421%, according to Tradeweb, from 0.464% just ahead of the ECB announcement. Yields fall as prices rise.
Many investors believe the eurozone economy is strong enough to handle the gradual shift in policy, underscoring the calm in the region's riskier assets in recent months. Expectations for a policy change come as the currency bloc's economy is on course for its strongest year since 2007, with measures of consumer confidence in the bloc reaching decade-highs.
While inflation has remained well below the bank's target, purchasing managers' indexes released this week showed the currency area posted its fastest employment growth in a decade, raising the prospect that rising wages may lift still-weak inflation.
Elsewhere in Europe on Thursday, Sweden's Riksbank and Norway's Norges Bank both left their monetary policy unchanged.
Earlier, Asian markets were little changed.
Write to Riva Gold at firstname.lastname@example.org and Michael Wursthorn at Michael.Wursthorn@wsj.com
(END) Dow Jones Newswires
October 26, 2017 15:41 ET (19:41 GMT)