A recovery in Chinese equities coupled with an ok start to the 2nd quarter earnings season boosted stocks today. Trading volume was heavy as the Dow posted a 33 point gain to 17,548. The Dow had been up 200 points early but the rally faded as Greek anxiety continues to cloud the headlines. Apparently Greek newspapers are running out of paper to print on because they do not have the bank lines needed to pay customs to allow newsprint to cross the border.
US earnings reporting for the second quarter has officially begun. Alcoa (AA) reported last night and the company beat its revenue targets and missed on its profit estimates. Forward guidance was strong and CEO Klaus Kleinfeld (KK) gave a bullish commentary. I guess we could say that “KK gave an OK about AA”. Pepsi reported earnings this morning and they nailed it by beating estimates and raising forward guidance. The street cheered the report and sent shares higher.
As travel demand in China surges, Boeing announced it had won another order from China Eastern Airlines Corp. valued at $4.6 billion in list prices for 50 single-aisle 737 jets. Last year, China Eastern placed an order for 80 737 jets valued at $7.4 billion. Chinese carriers are bringing in more orders for Boeing and Airbus as growth in the world’s second-largest economy enables more people to fly. China is poised to become the world’s biggest travel market in under two decades.
Commodities continue to be soft as money from around the world continues to drift toward the US dollar. Oil rebounded a bit today with WTI crude up 2.3% to $52.85 a barrel. Gold was off $4 an ounce to $1,159 an ounce. Silver and copper posted small gains but are still trading near lows.