- BofA profits soar on easy comparatives
- World Bank lifts growth forecasts
- NY manufacturing at highest since May 2012
Dow Jones: 0.24%
S&P 500: 0.22%
US markets opened strongly on Wednesday after the World Bank upped its outlook for the global economy and bellwether Bank of America beat expectations with its quarterly results.
Stocks were extending gains after the benchmark S&P 500
jumped 1.1% on Tuesday - its biggest gain in nearly a month - on the back of strong retail sales data and an increase in M&A activity.
The S&P 500 was up a further 0.2% on Wednesday after an upwards revision to 2014 global growth forecasts by the World Bank, which expects the world's economy to expand by 3.2% this year. This is an acceleration from the 2.4% growth seen in 2013 and higher than its June forecast for 2014 growth of 3%.
However, the multilateral organisation did raise concerns regarding rising interest rates and singled out the withdrawal of stimulus by the Federal Reserve as a specific worry.
The upcoming Fed policy meeting at the end of the month is beginning to draw some attention on the markets, with investors uncertain about how December's woeful jobs report will impact the decision on whether or not to continue tapering asset purchases.
As such, a speech by Chicago Fed President Charles Evans and the Fed's Beige Book will be closely watched later in the session as investors look for clues about the central bank's next move.
Mortgage applications, NY manufacturing pick up
On the macro-economic front, the Mortgage Bankers' Association revealed an 11.9% increase in mortgage application for the week to January 10th, compared to a rise of 2.6% a week earlier.
The Federal Reserve Bank of New York's regional manufacturing gauge moved higher in January to a reading of 12.51 points, up from a revised 2.22 the month before and well past the 3.5 expected by analysts. It is now at its highest level since May 2012.
US producer prices rose by 0.4% on the month in December, in line with market estimates. At the 'core' level they increased by 0.3% versus November, ahead of the 0.1% forecast.
BofA beats forecasts with Q4 numbers
Fourth-quarter profits at Bank of America surged to $3.44bn from just $732m a year ago when results were dampened by mortgage-related settlements. Per-share earnings rose to 29 cents, ahead of the 26 cents expected by analysts. Revenues also rose a better-than-expected 15% to $21.49bn, sending shares
3% higher early on.
Citigroup and Goldman Sachs, who are among 14 companies due to report their quarterly figures tomorrow, were making gains in morning trade. JPMorgan Chase & Co and Wells Fargo & Co, which released their results yesterday, were also advancing after a subdued performance the previous session.
Tesla Motors gained after the electric-car maker said it delivered 6,900 Model S cars in the fourth quarter, pushing its full-year sales beyond a company target.
ExOne Co. slumped after the 3D printing company said 2013 revenue will not exceed $42m, compared to its previous forecast of about $48m. Sector peer Stratasys also dropped after its 2014 profit forecast missed estimates.
The US 10-year government yield was up three basis points at 2.90%.
West Texas Intermediate crude futures for February delivery were 74 cents higher at $93.28 a barrel.