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Broadgate: Market News 18/4

18 April 2012

U.S. stocks scored their biggest gains in a month on Tuesday after Coca-Cola led a round of strong earnings and as concerns about Europe’s debt crisis eased as Spanish bond yields fell.

IBM, Intel and Yahoo all beat earnings estimates in their reports after the closing bell.

Earlier in the day, Coca-Cola, Goldman Sachs and Johnson & Johnson all reported profits that beat analysts’ estimates, in what has been a surprisingly strong start to earnings season.

“People were very pessimistic, marking down earnings expectations so there was plenty of room for the market to be positively surprised,” said Paul Zemsky, the New York-based head of asset allocation at ING Investment Management.

Gold edged up on Wednesday after a successful Spanish debt auction eased fears about the euro zone debt crisis, but gains were capped as the euro remained under pressure ahead of a longer-term debt sale in Madrid later this week.

Investors brushed off the soft U.S. industrial output and lower-than-expected housing starts data as relief over Spain’s finances and a surprise jump in German business sentiment lifted equities and other riskier assets.

“The nervousness around the euro zone has eased a bit, which could help stabilize the euro and support gold prices,” said Shanghai CIFCO Futures analyst Li Ning.

Buying interest in Asia’s physical market was muted, even as a key gold-buying festival in India looms on the horizon.

The yen fell broadly on Wednesday, extending its slip from a seven-week high against the dollar earlier this week, as a revival in risk appetite saw Wall Street score its biggest gains in a month.





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