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Overnight Markets: US stocks end higher on Citi earnings

by Himanshu Singh on Jul 15, 2014 at 04:02

Overnight Markets: US stocks end higher on Citi earnings

US stocks advanced on Monday, with the Dow Jones industrial average hitting an intraday record, as Citigroup Inc. rallied on better-than-forecast earnings and Internet shares rebounded.

The Dow Jones industrial average rose 112 points or 0.66%, to end at 17,055. The S&P 500 gained 10 points or 0.48%, to 1,977. The Nasdaq Composite added 25 points or 0.56%, to 4,440.

Citigroup Inc shares surged 3% and gave the S&P 500 one of its biggest boosts. The stock rallied after Citigroup reported second-quarter adjusted earnings per share that exceeded the average analyst estimate and agreed to pay $7 billion to settle a US government investigation into mortgage-backed securities.

Bank of America Corp. added 1.2%, JP Morgan Chase climbed 0.9% and Goldman Sachs increased 1.3%. Goldman Sachs Group Inc. raised its S&P 500 forecast for 2014 today to 2,050 from 1,900.

A flurry of mergers and acquisitions activity in the healthcare sector also boosted the shares. Shire Plc, which develops and sells drugs to treat rare diseases, succumbed to an increased takeover offer of £31 billion from AbbVie Inc on Monday. US-listed shares of Shire rose 2.1%, while AbbVie shares slipped 0.2%.

Generic drugmaker Mylan Inc said it would buy Abbott Laboratories' specialty and branded generics business outside the United States in an all-stock transaction valued at about $5.3 billion. Mylan shares advanced 2.1% while Abbott shares rose 1.3%.

Shares of electric car makers also surged on Monday after China-based electric vehicle maker Kandi Technologies Group Inc's sales from its joint venture in China more than tripled in the second quarter from the first quarter. US-listed shares of Kandi soared 26.6% while shares of US electric car maker Tesla climbed 3.9%.

URS (URS) Corp. jumped 12% after Aecom Technology Corp. agreed to acquire the construction-management company for about $4 billion.

In Asia, shares gained for a second day on Tuesday in morning session after Citigroup Inc. reported better-than-forecast profit, boosting confidence that earnings growth can sustain further gains in shares.

The MSCI Asia Pacific Index advanced 0.5% to 147 as of 9:48 a.m. in Hong Kong. Japan’s Topix index rose 0.9%. Australia’s S&P/ASX 200 Index added 0.1% as the nation’s central bank reiterated it expects a period of stable interest rates.

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